Multiple Offers - Dealing with the groups

This is a great town home in Carlsbad that we started the process on March 06, 2009. Our largest challenge with this home is dealing with the multiple offers from buyers wanting to purchase, but not wanting to wait.

It is emotionally difficult for today’s buyers to stay loyal for 90 days waiting for approval. And the danger of supporting one particular buyer over the other(s) is that the chosen buyer has a change of heart and decides not to purchase. Once the other buyers were notified an offer had been accepted, they will move on to other options. Measures must be taken to minimize this risk and keep the process moving in a timely manner.

This particular short-sale is looking in excellent shape. We are in constant contact with the bank and expect approval in the next 45 days.

Success! Countrywide Short-sale Closes

One of our great news success stories was this condo in Carlsbad. Over the last 9 months, the condo market in the coast went from $345,000 for a 2 bedroom, 2 bath to around $250,000. With a short-sale, a declining market is a huge challenge. As the process takes 60-90 days for bank approval, the market moves downward from where you have offers at and from where bank appraisals are assessing values. As values move down, buyers expect a reduction in price.

For Example:
August – Multiple offers at low $300’s.
September - Bank appraisal at $330,000
October - Bank Approval of purchase price, but prices have gone down since August. Buyer now wants property at $300,000.
Offer must be resubmitted - process restarts.

But after many months, we prevailed. The whole team (including the owner) is very excited to celebrate this new short sale closing.

The Details Have It

An important element in our high success ratio is giving the bank all required documents; signed authorization, statement of identity, financial documents, hardship letter, pay-stubs – to name a few. The bank wants to help those in need, but has a number of stop measures to prevent fraud and misconduct. Agents must have experience with the short-sale process. It is critical to have the proper documents in the order the bank requires to assure a timely short-sale . The result of delay and mismanagement is that the home takes too long to sell and the bank proceeds with foreclosure.

Short sales and market time

Getting approval on a short sale on takes time. Lot's of time. The layers of bank employee's and companies involved in mortgage ownership can slow the approval process. Imagine a football team requiring all 11 offensive players, coaching staff and owner to agree on which play to call. The game would take a very long time.

As it is with short-sale real estate. However, Patience is rewarded.

If you are a buyer in today's market, do not pass up the opportunity to offer on a short-sale home. Be prepared to wait 60-70 days for bank approval. Then another 20 days to close escrow.

Today We Start This Short-Sale Blog

After several months of capitulation on whether or not to start this blog, we will be posting real-life stories and helpful information regarding the short sale process. Short selling a home has become commonplace in today's real estate market. But we are finding there is much misinformation and misrepresentation. Hopefully, this blog will provide a platform for discussion and education.