Q. My spouse and I live in Blackhawk. Our home has significantly decreased in value since the peak market a few years back and now we are thinking of ‘short-selling’ it. I’ve heard that the success of a short sale depends heavily not only on the amount of the mortgage forgiveness but also on the specific bank or lender – is that true?
Yes, you are right. The bottom line is that some financial institutions cooperate greatly and some are ‘black holes’ that will consume your time, energy and sanity as you try to work within their system. The amount of lender cooperation or frustration is actually tracked on a monthly basis by third party short sale facilitators who typically assist homeowners and Realtors through the rigorous short sale approval process. For example, if your loan is with Wachovia, Wells Fargo Financial/Home Equity or Patelco, the initial response time for a short sale approval can be 30 days or less; however, if you loan is with PHH, US Bank or SunTrust, the response time can be a whopping four to six months. And this is only for first mortgages, not seconds, where it can get much more convoluted. As always, my advice is to navigate the short sale waters with a professional Realtor who specializes in the short sale market as that will provide your best chance of success.
Q. I have a friend at work who may be selling his home. I referred him to my preferred Realtor but he’s also thinking of using an agent he worked with in the past who now lives out of the area. My friend is concerned if he works with this non-local agent that the local agents may tend to ‘boycott’ the listing and not show his home because he chose to work with someone from the outside. Is that how it works? Your thoughts?
Your friend should have valid concerns from a couple of different aspects. The ‘boycotting’ thing could be a minor factor however the biggest concern should be trying to sell while being represented by an agent who is not intimately involved, day in and day out, with the dynamics of our 2011 local marketplace. This is a tough market and sellers need every possible advantage to come out ahead in the marketing of the property—the negotiating of the contract and the closing of the transaction. More transactions are falling apart (or worse yet, headed to litigation) at the eleventh hour in today’s market because sellers are choosing listing agents who aren’t assertive enough by nature or skillful enough by experience to get the job done—quite simply, they don’t do a thorough job up front of qualifying the buyer’s ‘loan-ability’. Mortgage lenders today are scrutinizing every aspect of the buyer’s qualifications, right up until the funding of the loan, which is too late in many transactions to right the ship if the lender ultimately denies the buyer’s loan. The bottom line: it’s never been more important or critical to sellers for their listing agent to find the RIGHT buyer for their home, not just any buyer. And many agents out there don’t even know the right questions to ask. Also, unless a seller has a strong negotiator in his corner, the inspection phase of the transaction can cost the seller dearly during the repairs negotiation. Lastly, I firmly believe that the daily marketing and networking of the property will suffer without a strong local agent; it’s a 24/7 job in today’s market. To summarize, your friend is wise to question the effectiveness of utilizing an out-of-area agent; my recommendation is to interview at least one credentialed local Realtor and then compare the service and skill level differences of the two agents prior to making such an important decision.Tom Hart is a practicing Real Estate Broker and a partner at Empire Realty Associates in Danville. He is a Certified Master Negotiator by the University of San Francisco and a Certified Master Strategist by HSM Harvard Program on Negotiation. He is past president of the Contra Costa Association of Realtors (2005) and past president of the Realtors’ Marketing Association of the San Ramon Valley. Tom is in high demand as a speaker & trainer inside & outside the real estate industry.