Jarmin and Jones – Short Sale Reality

Short Sale?? The painful yet money saving reality of short sales in today’s turbulent real estate market…..

by:

Shane Jarmin

1.  Buyers Consultants (99% of the time) have no communication, relationship, or connection with the banks. 

·       The people behind the scenes making decisions on short sales are called asset managers/negotiators.  The big banks (where most short sales loans are held) have a large number of these people on staff.  They are massive companies with thousands of employees and the asset manager/negotiator for a property in Atlanta could be located in Texas, California, or New York. 
·       Buyers Consultants do not have a direct line to the asset manager/negotiator of any bank.  It would be nice if they did, but they don’t.  DO NOT email your Buyers Consultants and ask them to “call up the bank” or “let the bank know.”  All a Buyers Consultant can do inform the Listing Consultant of your request and he/she can communicate your position to the Bank holding the loan. 
2.  The Listing Consultants are on YOUR side!
·       Residential Real Estate consultants do not get paid until closing.  It is in their best interest to get the deal closed as soon as possible.  Trust us when we tell you that the Listing Consultants working the short sales do everything they can to get the bank to move quickly.  The Listing Consultants also operate under very strict rules that the banks set.   Remember, YOU CAN ONLY MOVE AT THE SPEED OF THE BANK.  
 3.   Be prepared to wait.  Short sales can take anywhere from 45 days – 10 months to close…..Scary I know, but this is true…..
·       There is no way to determine how long a short sale will take.  Once again, there is NO WAY for your Buyers Consultant or the Listing Consultant to determine how long it may take.  Do NOT email your RE Consultant and ask “How much longer?” because you will sound like the kid in the back seat repeating “Are we there yet”.  The bank will NOT tell the Buyer’s Consultant how long it will take and they will not tell the Listing Consultant how long it will take because the Bank doesn’t even know how long it will take.  If you are not prepared to wait more than 45 days and up to 10 months, DO NOT BUY A SHORT SALE. 
 4.  The Bank does not care about YOU, the Seller, or the Real Estate Consultants.
·       Banks have no emotion invested in the short sale transaction.  The salary of the asset manager/negotiator is not affected by the outcome of the transaction.   When the bank goes on vacation your short sale file goes with them.  When the bank takes the Federal Holiday off so does your short sale file.  Banks are closed on Saturdays and Sundays, this means your file is sitting on a desk and nobody is working on it. 
5.  Prior to short sale approval take updates with a grain of salt.   
·       Keep your emotions in check if you receive an update that the file is almost complete or the payoff letter will be done soon.  It is very likely that a “one week til’ we’re done” comment from the Bank could very well mean 4 weeks. 
 6.  Threatening for the most part does not work.
·       If you attempt to pull a “We’re walking from this deal if they aren’t ready to close by (insert date and time here)” don’t be surprised when the bank isn’t ready.  Refer back to #4.  The salary of the asset manager/negotiator is not affected by the outcome of your transaction.  The Bank (usually) has no problem waiting for another buyer.
 
7.  KEEP SHOPPING
·       One of the beauties of short sales is that there is no financial commitment until the Bank has signed on the dotted line.  A real estate Purchase and Sale Agreement is not binding until all parties have signed.  So while you are waiting for Bank approval keep looking for anything that may come available that meets your criteria.   If you find a resale or foreclosure that interests you then make the offer.  You can always withdraw your short sale offer prior to Bank approval.
.
Now this advice might come across as a bit extreme but this is nature of the real estate beast right now. The up-side is getting your home, townhome or condo at an considerable discounted price. Even though the process seems like, and most of the time is a headache, remember that this is a “short-sale.” The bank is getting shorted and the buyer is getting a deal for the most part. To most people saving 10k to 30k is well worth the wait/ headaches. As always thank you for following Jarmin and Jones Real Estate Group and please drop us a line if you are house-hunting in the Atlanta area.
Posted/ edited:
 19 January, 2012
Albert Jones – Jarmin and Jones Real Estate Group

Comments are closed.