Comments on: Foreclosures, REOs, Short Sales and Auctions – What’s the difference? http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/ News and info on Atlanta real estate and north Georgia real estate from the experts at Better Homes and Gardens Real Estate Metro Brokers Wed, 17 Mar 2010 15:40:54 +0000 http://wordpress.com/ hourly 1 By: J Lusby http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1537 J Lusby Fri, 25 Dec 2009 05:19:45 +0000 http://blog.metrobrokers.com/?p=1107#comment-1537 There are good companies out there actually trying to help people. But unfortunately there are also bad ones that are trying to take advantage of situations. I purchased 2 forclosures and have been happy with my purchases. There are good companies out there actually trying to help people. But unfortunately there are also bad ones that are trying to take advantage of situations. I purchased 2 forclosures and have been happy with my purchases.

]]> By: Lynn Kennedy http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1318 Lynn Kennedy Mon, 19 Oct 2009 20:58:12 +0000 http://blog.metrobrokers.com/?p=1107#comment-1318 Hi Ann! I'm going out on a limb asking this question but here it goes....Because short-sales are quite lengthy, would it be okay if we got someone to submit a (dummy) contract so to speak, just to get the process going and put a due diligence period on there that could protect the buyer submitting the contract to get their earnest money back? I've sold a few short sale listings this year and as the listing agent, and depending on the seller's lender, they did take several months. The goal is to know exactly what the bank will accept. Wouldn't that be better than sitting on the market for a long time, with the listing saying, "potential short sale"? So many realtors are shunning potential short-sale listings because of the time, so maybe to get the process jump started, we could do that and once approved, change the listing status to approved short sale. And the "dummy" buyer can terminate the contract and the seller can agree to give back their earnest money. Just asking... Hi Ann!
I’m going out on a limb asking this question but here it goes….Because short-sales are quite lengthy, would it be okay if we got someone to submit a (dummy) contract so to speak, just to get the process going and put a due diligence period on there that could protect the buyer submitting the contract to get their earnest money back? I’ve sold a few short sale listings this year and as the listing agent, and depending on the seller’s lender, they did take several months. The goal is to know exactly what the bank will accept. Wouldn’t that be better than sitting on the market for a long time, with the listing saying, “potential short sale”? So many realtors are shunning potential short-sale listings because of the time, so maybe to get the process jump started, we could do that and once approved, change the listing status to approved short sale. And the “dummy” buyer can terminate the contract and the seller can agree to give back their earnest money. Just asking…

]]> By: Gary Lockman http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1314 Gary Lockman Mon, 19 Oct 2009 17:08:43 +0000 http://blog.metrobrokers.com/?p=1107#comment-1314 Ann i noticed all the comments on how difficult short sales were and they are when you don't have a relationship with the lender or even the seller/owner of the property. As a builder and with several new homes that i have been able to get the lender to take short sales i suggest the agent go after NEW HOMES. they are easier and quicker to get done and the homes will not be destroyed (at least ours won't). Good luck Ann i noticed all the comments on how difficult short sales were and they are when you don’t have a relationship with the lender or even the seller/owner of the property. As a builder and with several new homes that i have been able to get the lender to take short sales i suggest the agent go after NEW HOMES. they are easier and quicker to get done and the homes will not be destroyed (at least ours won’t). Good luck

]]> By: Melissa Maxie http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1307 Melissa Maxie Sat, 17 Oct 2009 02:06:54 +0000 http://blog.metrobrokers.com/?p=1107#comment-1307 I currently have one of my short sale listings “Pending". Overall, the short sale approval process was a breeze, thanks to my sellers being very truthful and staying on top of their lender each and every evening. Each day we would both pick up the phone and call the lender's Loss Mitigation Department. Even if they didn't have any news...they would hear from us. We had our approval within 30 days and were ready to close....just when the buyer's lender now says they cannot give him the loan terms he was promised. So that has caused us to go into panic mode and help this buyer find a new lender. We are now waiting on the new appraisal to come back and hopefully we will have this one closed very soon. It would have been a very smooth Short Sale...but it just had to be messed up by the opposite lender. My point is that if we have good, truthful, willing to help sellers….we can do this! We must educate the buyers as well…they must be patient and be willing to wait out the approval process. We must also know how to write the contract to protect our buyers on Short Sales, such as due diligence periods and financing periods. We can do this! Yes it is hard and yes, I have got in my car and screamed...but in the end I will have a paycheck! A sale is a sale and what else do we have to do with our time…? I currently have one of my short sale listings “Pending”. Overall, the short sale approval process was a breeze, thanks to my sellers being very truthful and staying on top of their lender each and every evening. Each day we would both pick up the phone and call the lender’s Loss Mitigation Department. Even if they didn’t have any news…they would hear from us. We had our approval within 30 days and were ready to close….just when the buyer’s lender now says they cannot give him the loan terms he was promised. So that has caused us to go into panic mode and help this buyer find a new lender. We are now waiting on the new appraisal to come back and hopefully we will have this one closed very soon. It would have been a very smooth Short Sale…but it just had to be messed up by the opposite lender. My point is that if we have good, truthful, willing to help sellers….we can do this! We must educate the buyers as well…they must be patient and be willing to wait out the approval process. We must also know how to write the contract to protect our buyers on Short Sales, such as due diligence periods and financing periods. We can do this! Yes it is hard and yes, I have got in my car and screamed…but in the end I will have a paycheck!
A sale is a sale and what else do we have to do with our time…?

]]> By: Althea A Alvaranga http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1305 Althea A Alvaranga Fri, 16 Oct 2009 00:43:11 +0000 http://blog.metrobrokers.com/?p=1107#comment-1305 Excellent article and tips from all! I am fairly new to the business and new to Metro Brokers and seem to be attracting the buyers hunting for foreclosures (bargains). My only successful short sale was a 6 month process, with 5 months of my buyer threatening to sign a lease. What I believe actually got us to the closing table was all parties (both agents, sellers, attorney, lender) working as a team to pacify the bank...and me informing my buyer every step of the way. After all was said and done, the bank cut our commission and closing attorney fees to give that final stamp of approval. After 6 months, we were all just ready to close! Excellent article and tips from all! I am fairly new to the business and new to Metro Brokers and seem to be attracting the buyers hunting for foreclosures (bargains). My only successful short sale was a 6 month process, with 5 months of my buyer threatening to sign a lease. What I believe actually got us to the closing table was all parties (both agents, sellers, attorney, lender) working as a team to pacify the bank…and me informing my buyer every step of the way. After all was said and done, the bank cut our commission and closing attorney fees to give that final stamp of approval. After 6 months, we were all just ready to close!

]]> By: ann bone http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1293 ann bone Wed, 14 Oct 2009 14:07:48 +0000 http://blog.metrobrokers.com/?p=1107#comment-1293 The cost of doing the title search at listing time SHOULD be paid by the seller, who will be the beneficiary of a successful short sale. It's usually about $150 and any real estate attorney would be able to assist with this. If the seller pleads absolute poverty, an agent COULD pay for it, but I would wonder just how committed a seller is to the process if he/she isn't willing to even get the process started. Yes, individual lenders vary widely in their policies. Some won't even look at the package without an offer as they consider it premature or potentially wasted effort in the event no offer ever comes in. Some progressive lenders go ahead and gather the completed package from the seller, a BPO (Broker Price Opinion) from one or more agents and are prepared to respond quickly when/if an offer does come in. Lenders seem to be very short-staffed in their "short sale negotiation" departments. The cost of doing the title search at listing time SHOULD be paid by the seller, who will be the beneficiary of a successful short sale. It’s usually about $150 and any real estate attorney would be able to assist with this. If the seller pleads absolute poverty, an agent COULD pay for it, but I would wonder just how committed a seller is to the process if he/she isn’t willing to even get the process started.

Yes, individual lenders vary widely in their policies. Some won’t even look at the package without an offer as they consider it premature or potentially wasted effort in the event no offer ever comes in. Some progressive lenders go ahead and gather the completed package from the seller, a BPO (Broker Price Opinion) from one or more agents and are prepared to respond quickly when/if an offer does come in. Lenders seem to be very short-staffed in their “short sale negotiation” departments.

]]> By: ann bone http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1292 ann bone Wed, 14 Oct 2009 13:56:47 +0000 http://blog.metrobrokers.com/?p=1107#comment-1292 Rich, I've emailed you a more complete explanation of the "buying on the courthouse steps" process, but the short answers are: You're correct that buyer will not have an opportunity to inspect or even view the property before the auction UNLESS THE PROPERTY WAS ALREADY ON THE MARKET FOR SALE. Buyer SHOULD have a title search done (about $150) before buying on the courthouse steps because he gets all the liens with the property. Cash on the table - bring certified funds. Good luck! Rich,

I’ve emailed you a more complete explanation of the “buying on the courthouse steps” process, but the short answers are: You’re correct that buyer will not have an opportunity to inspect or even view the property before the auction UNLESS THE PROPERTY WAS ALREADY ON THE MARKET FOR SALE. Buyer SHOULD have a title search done (about $150) before buying on the courthouse steps because he gets all the liens with the property. Cash on the table – bring certified funds.

Good luck!

]]> By: Linda Gregory http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1291 Linda Gregory Wed, 14 Oct 2009 02:05:10 +0000 http://blog.metrobrokers.com/?p=1107#comment-1291 Be patient and keep your client informed of progress. Be patient and keep your client informed of progress.

]]> By: Rich Bowman http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1290 Rich Bowman Wed, 14 Oct 2009 00:39:01 +0000 http://blog.metrobrokers.com/?p=1107#comment-1290 Very good article. I've done a couple REO sales and one short sale (both as the selling agent) and the key is certainly patience. Its also very important to throughly prepare the client for the process so they know what to expect and don't get frustrated when things move very slowly. I have a question about a client who is considering buying a property at the courthouse steps at the foreclosure auction. What are the pitfalls I should warn him about? I believe that once it is purchased on the steps that there is no opportunity to do an inspection or title search or anything else. Is this the case? How do the agents get compesated on these types of transactions? Very good article. I’ve done a couple REO sales and one short sale (both as the selling agent) and the key is certainly patience. Its also very important to throughly prepare the client for the process so they know what to expect and don’t get frustrated when things move very slowly.

I have a question about a client who is considering buying a property at the courthouse steps at the foreclosure auction. What are the pitfalls I should warn him about? I believe that once it is purchased on the steps that there is no opportunity to do an inspection or title search or anything else. Is this the case? How do the agents get compesated on these types of transactions?

]]> By: Annette Osbourne http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1287 Annette Osbourne Tue, 13 Oct 2009 08:51:36 +0000 http://blog.metrobrokers.com/?p=1107#comment-1287 thanks Ann... I;ll get started on that right away. thanks Ann… I;ll get started on that right away.

]]> By: Deborah Gaither Realtor Delivering On The Promise http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1286 Deborah Gaither Realtor Delivering On The Promise Tue, 13 Oct 2009 01:28:22 +0000 http://blog.metrobrokers.com/?p=1107#comment-1286 Great article Ann! Very informative. I have a short sale property listed and I have a question about your suggestion to get a title search. As the seller agent initiating the title search; who is responsible for payment for the title search? Also, through recent contact with my seller's lender, I inquired about their policy and procedures regarding having the short sale approved prior to submitting an offer; and was told they would not accept the short sale package without an offer. Is this a common practice or does the policy vary with different lenders? Great article Ann! Very informative.
I have a short sale property listed and I have a question about your suggestion to get a title search. As the seller agent initiating the title search; who is responsible for payment for the title search?
Also, through recent contact with my seller’s lender, I inquired about their policy and procedures regarding having the short sale approved prior to submitting an offer; and was told they would not accept the short sale package without an offer. Is this a common practice or does the policy vary with different lenders?

]]> By: ann bone http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1285 ann bone Mon, 12 Oct 2009 21:09:55 +0000 http://blog.metrobrokers.com/?p=1107#comment-1285 I would get a title search done ASAP and request a Short Sale package from each and every lien holder the title search turns up. Get the seller to work completing those packages so that each lien holder can be ready when an offer comes in. Hopefully, the seller hasn't too many liens on the property and doesn't have to spend too much time on getting his documentation gathered. Until these packages are submitted to the lien holders, only advertise the listing as "potential short sale" - let other agents know that much of the seller's work still remains to be done. Good luck! I would get a title search done ASAP and request a Short Sale package from each and every lien holder the title search turns up. Get the seller to work completing those packages so that each lien holder can be ready when an offer comes in. Hopefully, the seller hasn’t too many liens on the property and doesn’t have to spend too much time on getting his documentation gathered. Until these packages are submitted to the lien holders, only advertise the listing as “potential short sale” – let other agents know that much of the seller’s work still remains to be done.

Good luck!

]]> By: Annette Osbourne http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1283 Annette Osbourne Mon, 12 Oct 2009 19:31:09 +0000 http://blog.metrobrokers.com/?p=1107#comment-1283 Great article Ann. Constant provision of the difference between the three is an absolute in this market... somehow most believe reos and foreclosures are the same and shortsales are now something to run away from. Shortsales are definitely time consuming... I just took the task of listing one.. wish me luck! I am open to suggestions on how to expedite successfully. Great article Ann. Constant provision of the difference between the three is an absolute in this market… somehow most believe reos and foreclosures are the same and shortsales are now something to run away from. Shortsales are definitely time consuming… I just took the task of listing one.. wish me luck! I am open to suggestions on how to expedite successfully.

]]> By: Tiki Carter http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1282 Tiki Carter Mon, 12 Oct 2009 16:02:17 +0000 http://blog.metrobrokers.com/?p=1107#comment-1282 Foreclosures have been my only busiess pretty much this year. I have worked one short sale, unsuccessfully, due to the bank's unrealistic goal of getting more money from my buyers. It's important to sit down and talk with your clients about both types of transactions before anything else. I will say that working foreclosures gets easier with experience. You tend to learn what the banks are looking for in the contract. I think the most important aspect is educate your clients many times throughout the transaction and create open communication between the listing agent/assistants from beginning to end. Good article Ann, I will be sure to let my clients read it! Foreclosures have been my only busiess pretty much this year. I have worked one short sale, unsuccessfully, due to the bank’s unrealistic goal of getting more money from my buyers. It’s important to sit down and talk with your clients about both types of transactions before anything else. I will say that working foreclosures gets easier with experience. You tend to learn what the banks are looking for in the contract. I think the most important aspect is educate your clients many times throughout the transaction and create open communication between the listing agent/assistants from beginning to end. Good article Ann, I will be sure to let my clients read it!

]]> By: Anne Langley http://blog.metrobrokers.com/2009/10/12/foreclosures-reos-short-sales-and-auctions-%e2%80%93-what%e2%80%99s-the-difference/#comment-1281 Anne Langley Mon, 12 Oct 2009 15:06:32 +0000 http://blog.metrobrokers.com/?p=1107#comment-1281 Due to my negative experience with short sales (I have yet to get one to the closing table either because my buyers don't have te patience to wait it out or the listing agent is inexperienced with short sales) I have listed and sold foreclosed homes in the past but recently I find that buyers want the low price, but don't want the hassle of the repairs or the uncertainty of the foreclosed properties. I too am finding the best value for the money are the sellers who need to sell, but are not in default or headed to default. My buyers feel more secure with knowing they are dealing with a person and not a corporation or bank. Due to my negative experience with short sales (I have yet to get one to the closing table either because my buyers don’t have te patience to wait it out or the listing agent is inexperienced with short sales) I have listed and sold foreclosed homes in the past but recently I find that buyers want the low price, but don’t want the hassle of the repairs or the uncertainty of the foreclosed properties. I too am finding the best value for the money are the sellers who need to sell, but are not in default or headed to default. My buyers feel more secure with knowing they are dealing with a person and not a corporation or bank.

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