Short sale processing needs to be considered when your two biggest problems are Demand and Delays. You know you’re dealing with a lot of frustrated people in a huge potential market.
In the past year or so, Short Sales have gone from an obscure real estate transaction to being headline news around the country.
Not surprisingly, a lot of those headlines have focused on the frustrations of homeowners, buyers and agents. Read more about stop foreclosure Hawaii
This is NOT negative publicity for though! This is a good thing, shining a light on problems and putting pressure on Washington, DC to fix the process. Well they’re trying anyway…
“What I have seen banks do is put off foreclosing, particularly on properties that will be difficult to sell. It’s like they are begging us to get the ball rolling… then they take months to approve it.”
Sure enough, the behavior of banks seems unreasonable, if not insane.
Shadow Inventory is no secret and not a secret stash of properties that banks are keeping off the market in a deliberate conspiracy.
Shadow Inventory is, very simply, the massive backlog of foreclosed homes that haven’t been processed yet. This is very simple, very real, and most importantly, very large, well over 4.7 million now and growing.
Now consider that once those properties get listed, the backlog will be even larger as the foreclosure rates increase in 2011.
According to an August 2010 statement from the Mortgage Bankers Association, there now 7 million+ US homes in default or that have yet to be processed.
This problem is growing faster than it can be dealt with, so expect Shadow Inventory to continue making headlines and causing headaches in the months and maybe years to come.
I think everyone should know this by now, but I’m going to say it anyway.
“Banks aren’t in the business of doing short sales, they’re set up to make loans; they’re not set up to do workouts.”
“The biggest reason why short sales don’t get approved is that the bank mitigators will say that the price is below market value!”
In my experience, there are no guarantees a sale will go through once the process has begun and the mortgage holders can foreclose before a process is completed especially if not done to the banks mitigators liking.
The short sale processing and the foreclosure process are two trains running on parallel tracks. The fact that you’re trying to do a short sale doesn’t stop foreclosure. A purchase contract on the property only slows the process, but if the purchaser backs out the foreclosure continues, not starts over!
A Solution that will help many, is having a great rapport with the banks mitigators and having the technology to make their jobs much easier.
One thing I do know for a fact – Short sales are better than foreclosures, for absolutely everyone involved… Even the banks!
Here are two important reasons why:
Short Sales – do less damage to your client’s credit score and explaining this will gain more trust.
Short Sales – let your client buy a home sooner and they will come back to you for their next purchase.
Everyone has a vested interest in seeing the real estate market recover as soon as possible:
(Sellers, Buyers, Realtors, Brokers, Banks and even Investors)
How can we resolve the issues of time delays, long timeframes, extensive document collection/submission and offer validation?
These are the questions that serious real estate professionals have asked for a long time. Sure the opportunity is out there to make a ton of money through short sales, there just has to be an adequate solution to these problematic hurdles.
There is a piece of technology that was designed and developed to relieve all the problems associated with a short sale.
It’s called The Short Sale Engine and this online system is a direct response to the ailments of the business.
The Short Sale Engine has revolutionized the way real estate professionals are doing business by automating the entire process of document collection and submission through an online interface.
Rather than crawling through the 4 to 6-month waiting game of a typical close. Speeding up the short sale processing will help cure the problem our nation has now, hence, making it much easier for everyone to recover from the current mortgage market.
Author: Christopher Smith lives in Scottsdale, Arizona – He is a part-time internet marketer, Real Estate Investor/ Realtor, Successful home business owner since 2007, Help’s with business building strategies, marketing and personal achievement.