Why do so many Realtors NOT want to help me with Short Sales or Foreclosures?
Author: Kevin Cloutier
Written On: Tue, 20 Nov 2012
To most people do not realize that a fair number of good Realtors do not like to work with Short Sales and Foreclosures. That may sound odd being it is how we earn a paycheck, but regardless if your listing or writing an offer on a one of these types of properties, most will decline to help. Why? Here are 5 listed below and after digesting what is here, ask yourself one question; "Would You?"
#1. Nearly 25% of all sales are either short sales or foreclosures. Agents DO provide help to buyers and seller in these situations, but its not our first choice.
#2. Short sales are highly complex and unpredictable and REQUIRE a truly committed and capable buyer. If you are a marginal or casual buyer, an agent will spend 10, 25, 60 hours on your behalf and you will disappear. Why? YOu can not get an answer from the bank and the buyer gets understandably frustrated. No one wants that to happen. Keep those direct hours in the back of your mind, you'll need them later.
#3. Foreclosures are very competitive. If you are shopping at the top of your ability to buy, you will not be able to make the +15% offer to get into the game. If you are using FHA or VA backed financing, you are handicapped even further by inspection/appraisal guidelines and lengthy timefram,es to close. If a bank does agree to an offer, they want to know that the buyer can close FAST.
#4. Price point. If you are shopping at the 'below" $100,000 level, you may find many lenders will sink your deal during the last week of the event. Of course they won't tell you, "There's no money to be made" but that is the reality. Then consider the direct hours and agent spends and the possible income from a low price purchase.
#5. You may be working with a predatory lender requiring a 'kick-back' or compensation to pay the mortgage brokers fees. I have even had insurance companies holding their hand out for a few bucks thrown there way to sign off when I do not believ they have any say in the offer. They offered insurance to the bank, not the borrower that defaulted. So, that is between the bank and the insurance conmpany. But they try and often succeed or they end up trashing the deal.
IU coulkd go on and on, but suffice to say that when you decide you want to get into this type of sale, just realize that your agent will put in the most hours of work, deal with the most fruastraing situations and in the end if the deal does close, make the smallest amount of money for their efforts.