Is that short sale in Chandler (or anywhere else) going to waste your time?

Photo credit Aoiefe

Photo credit Aoiefe

There are a couple things you need to know before you submit an offer on a short sale. #1 ~ Is the home REALLY a short sale? and #2 ~ Does the listing agent have the knowledge to close the deal?

Out of all the homes for sale in Chandler, AZ about 30% are listed as short sales but less than half of them are resulting in a sale.  Could it be that many of these short sales are not really short sales and could it be  the listing agent hasn’t got a clue. 

When I’m representing a buyer, I counsel them on exactly what a short sale is and whether or not it will fit their time frames.  I also share with them the qualifying questions I will ask every short sale listing agent prior to even showing my buyer the home.  If the listing agent cannot answer my questions with something other than “Uh…I don’t know” or “what does that mean?”, I won’t waste my buyer’s time showing the listing.

Here some of the questions I ask a the listing agent before showing their short sale listing:

What is the seller’s hardship?  There has to be a hardship plain and simple or the lender will not allow the short sale.  By the way, wanting a bigger home is not a hardship and simply owing more than the home is worth isn’t either.

What stage of foreclosure is the property in?

Has a sale date been set?

Have you submitted any offers to the lender?  If this answer is yes…I’m not showing this home.  My experience has been if more than one offer is submitted, the time frames have just increased and the lender may never make a decision.   If no offers have been received, I’ll ask the next question~

How many offers will you be submitting to the lender?  If the answer is more than one…I’m not showing this home.

What documents has the seller completed that are in your possession or the lender’s possession? If the agent hasn’t even begun working on the package of required documentation that will be submitted with our offer, I’m not wasting our time on this one.

Have you verified the parties on the Deed of Trust and the Deed?  Do you even know if the party who has listed the home is the person who can list the home or if there are other parties on the documents that will halt a short sale in its tracks?

How many lien holders are there?  If the agent doesn’t know what a lien holder is (yes, I’ve had this happen), that pretty much ends this call.

Will I receive a signed contract from the seller if an offer is submitted?  Short sales are no different than a regular resale.  A buyer and a seller are still negotiating a contract that requires the buyer’s and seller’s signatures.  So, if we’re not working with a real contract, we’re not interested.

These are just a few of the questions I ask and each one is adapted depending on the answer I’m given, but I think if more listing agents obtain the education to identify and close a short sale it will impact the success rate considerably. 

If buyer’s agents will take the time to prequalify the property and let the listing agent know why they won’t be showing it…just maybe the listing agent will get educated so they can REALLY help their sellers.

 

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Comments

  1. THANK YOU FOR PUTTING THE INFORMATION ON A SHORT SALE ON YOUR WEBSITE, IT WAS VERY HELP FULL, AND I LIKE THE WAY YOU TREAT A SHORT SALE , IN ASKING THE QUESTIONS YOU DO. WHAT IS THE AVERAGE TIME IN DEALING WITH A SHORT SALE. THANK YOU, JOHN

  2. Hi Johnny ~ There is no rule for short sales, however some can close in a few weeks and others can take up to 8 months or more. A lot will depend on the lender involved.