Buyers need your help to close on short sales, REOs

Realtor Notebook

There might be more information than ever before available to consumers on the Internet, but it won’t replace real estate agents anytime soon.

More has been added to our role. Sometimes it feels like we are becoming a source for free labor for banks and government agencies who will not allow buyers or sellers to represent themselves. Sometimes, they make information about special programs available only to real estate agents.

Between Neighborhood Stabilization Program homes, traditional foreclosures and Fannie Mae foreclosures called "HomePath" homes, the homebuying process has changed. When a government agency is the seller, they sometimes use a committee to determine if the buyer is qualified to buy the home.  There are processes and there is paperwork, and sometimes representing one buyer or short-sale seller can feel like a full-time job.

The paperwork can be complicated and the instructions are not always clear. There are agents who are avoiding showing certain homes to their buyers because they don’t understand the programs and can’t handle the paperwork.

I would be outraged by this, but I have gotten business because of it. It takes time and a little patience, and the ability to read and follow instructions and make phone calls when the instructions don’t make sense. Buyers are demanding our help with these programs, and institutions are requiring that they get that help from real estate agents.

For one program, my client and I generated 64 pages of documentation that had to be submitted to the city. I am not equipped to handle that much paper. I had no idea what to do with it, and did not have any time to think about it. So I took the pile of paper to the local copy shop and spent $23 to have it put in a high-speed scanner that turned the documents into PDFs.

Resistance is futile. We can leave no stone unturned as the inventory of homes on the market continues to shrink.

Right now there are plenty of banks and government entities that either own real estate or have become a stakeholder or decision-maker in the process. Getting a listing can be about writing proposals and submitting forms, and a government agency or a bank can defeat the most tech-savvy of agents if he or she is not prepared with an antiquated computer system and a lot of paper.

There is one program with homes for sale that accepts only electronic offers. Some of the banks can only be dealt with through Web-based systems that won’t work with most mobile devices and require specific browsers. They even send us an email that can be viewed on a mobile device to alert us that there is a message for us in the system, but we can access the message only with a computer.

Filling out a form incorrectly can cost a buyer a home. Being too slow to get the paperwork to where it needs to go can cost a buyer a home.

Failing to read and understand instructions and leaving an "i" undotted or a "t" uncrossed can also cost a buyer a home. We have to be willing to read and learn, and even take a class or webinar if needed.

We have to play by the rules of third parties, but they do not always follow ours. In Minnesota, electronic signatures are allowed, but all parties have to agree. Some short-sale negotiators say no to electronic signatures, and we don’t always win when we try to cram electronically signed documents into their systems.

Transactions are more complicated when we deal with large corporations and government entities. There is more emphasis on paperwork and less emphasis on sales ability or negotiation skills.

It isn’t all bad — it is just different. It’s one of many changes we have seen in the real estate industry in the last couple of years that most of us didn’t really anticipate or plan for. My guess is the programs will continue to change and evolve, and the only way to escape them is to focus on upper-bracket homes.

Teresa Boardman is a broker in St. Paul, Minn., and founder of the St. Paul Real Estate blog.

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