Completing a successful Chicago short sale transaction requires communication and proper expectation setting across all parties. An article crossed my desk this morning that I thought would make the perfect outline to set short sale expectations for both the seller and buyer side.
To entice you to read the entire article, the top 10 points (typos and all) are highlighted below.
1) Price is usually set by the agent & seller, not bank
2) Loans owned by 1 bank usually better than 2
3) Lowball offers get slow or no response
4) Agent must check comparables before submitting offer
5) Don’t hang your hat on the property
6) Sellers with other properties or too strong of financials may not qualify for short sale and/or may be asked to pay the difference
7) ”Approved” prices are quickest
8) Some banks want strongest buyers, some want strongest offers
9) Repairs are seldom done, credit is more frequent
10) When you get approval, must close on time
Having completed a number of short sale transctions on both the buy and sell sides, I can attest that all points are on target. The full article can be found here.
{ 3 comments… read them below or add one }
Great article about short sales. It really highlights the importance of hiring an experienced agent, like you and your team members, to represent a buyer or seller in these types of complex transactions. Thanks for providing this informative article about a current “hot topic!”
Jeff, I found your article interesting and you touched on a lot of valid points. However, I think the biggest challenge in getting short sales approved with lenders can actually be the listing agent involved in the short sale transaction. Frequently, these agents have little or no experience in short sales and do not know how to navigate a bank in order to get short sales approved. Many times this is why short sales take so long. If you or any agent needs help with short sales negotiations they should visit my site at http://www.yds-inc.com
Jim Murrin – Short Sale Specialist – Chicago
Thanks for visiting Jim, I agree.
I would also submit that troubles arise way before having to navigate the bank. Smooth short sales result due to clear communication up front to both seller and prospective buyer(s). But this requires an understanding of the process at the outset … oops.
As an example on the listing side, pricing is critical in a short sale. Take the case of a listing priced way below even current market standards. The result will surely be multiple offers, some realistic and some not. Proper handling of these offers is key. In my experience, an aggressive yet realistic offer based on current market data is the start of a successful transaction.
On the buy side I would also add that an inexperienced buyer agent presents a huge challenge. Setting buyer expectations is key in the process. But this requires an understanding of the process. It also requires understanding when a listing is priced at an unrealistically low level … simply to generate multiple offers.
Best with the venture.