The short-sale action guide
Book Review: 'How to Use a Short Sale to Stop Home Foreclosure ...'
By Tara-Nicholle Nelson, Tuesday, September 22, 2009.
Image courtesy of McGraw-Hill.Book Review
Title: "How to Use a Short Sale to Stop Home Foreclosure and Protect Your Finances"
Author: Robert Irwin
Publisher: McGraw-Hill, 2009; 208 pages; $18.95 list ($14.21 on amazon.com)
If you're an active participant in today's real estate market, you know that the recent drop in housing values -- right after a couple of years of unprecedented borrowing against home equity -- has forced us all to get much more familiar with short sales than ever before.
(A short sale, for your information, is a transaction in which the homeowner is selling the home for less than he or she owes on it. This requires that the lender or lenders involved agree to forgive some portion of the outstanding mortgage debt in order to consummate the transaction.)
Short-sale feasibility is the issue of the day, and seems to run on a roller-coaster of extremes, depending on how the wind blows on any given day, week or month.
First, the banks didn't want to do them. Then, they were agreeing to forgive the upside-down debt, as needed for these transactions to close. Then, they were agreeing to do the short sales but placed a bunch of infeasible conditions on the seller, buyer and even agents involved, blocking the progress of the transaction.
And always, it has seemed that sellers didn't have a huge amount of control over whether and on which conditions their lender would allow a short sale. Frankly, the short sale process can seem so complicated, convoluted and opaque that many sellers would just prefer to let the home go into foreclosure.
In "How to Use a Short Sale to Stop Home Foreclosure and Protect Your Finances," author Robert Irwin provides a sense of hope and control in the form of a short-sale action guide for homeowners facing foreclosure. Several things about this book will render it appealing and useful to upside-down homeowners who need to sell their homes.
First off, it is a quick and easy read, and does not assume a huge amount of advance knowledge, nor does it assume that you want to become a real estate expert. As such, if you're considering walking away from your home, but feel like you can spend an hour and a half exploring and empowering yourself with an alternative to foreclosure, this book is the ticket. ...CONTINUED
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Submitted by Alexis Eldorrado on September 22, 2009 - 12:43pm.
Thanks for the great recommendation and I am sure this will be a useful guide on short-sales for both the consumer and real estate practitioners. I know we have done several here at Eldorrado Chicago Real Estate and each one has so many different variables based on the lender. There seems to be no “one size fits all” when it comes to short sales. However, this guide is a good primer and thank you for recommending it.
This past Sunday’s Chicago Tribune’s Money and Real Estate section also had a great article on Short-sales in the Chicago real estate market that was very realistic and valuable.
We also have one or two experts that deal with them within our Chicago real estate brokerage community. From my own experience, there always seems to be one variable, and that is the lenders and what the lenders’ requirements are. For example, I know of one lender who said a short sale could be done only if the property was on the market for three month’s prior to a foreclosure sale date.
However, even with the variables, the standards as you highlighted in this article via this Guide seem to be materializing more and more. Nine months ago, for example, everything was like the Wild West. Requirements, procedures, and Prices in the short sale market now seem to be stabilizing. I truly believe we have hit the bottom of the marketplace which will be a blessing for America’s economic recovery.
Alexis Eldorrado
Managing Broker
Eldorrado Chicago Real Estate LLC
150 N. Michigan Avenue, Suite 2800
Chicago, IL 60601
773-588-7777
Alexis@Eldorrado.com
www.Eldorrado.com
Submitted by Danny C. Flucke Jr. on September 22, 2009 - 1:29pm.
Great article Tara - And an additional point to consider...
Our ABA partners/realtors are having great success negotiating a pre-approved short sale listing price with the lender BEFORE taking the listing.
We all know the most difficult part of a short sale offer/listing - Is getting the lender to move forward.
The main sources of delays are the lenders being required to explore alternatives with the homeowner including modification options and outright foreclosure/deed in lieu.
When a client/ABA partner referral DOES NOT qualify for a mortgage modification - The US Treasury spreadsheet details the exact short sale terms supported by the latest bailout program.
Our program PROVES the homeowner does not qualify for any other options - AND delivers the exact short sale terms - Making it easy for the lender to pre-approve the short sale listing price.
In summary:
1) Jane Doe/Realtor refers John Smith to NaMoEx for a possible loan modification.
2) John Smith does not qualify per US Treasury guidelines. (And receives a 100% refund)
3) Jane Doe is selected as the realtor to sell the home. (How much loyalty and trust is created when John Smith gets a 100% refund of his modification fee…!?!?!)
4) NaMoEx prepares the short sale pre-approval case file for Jane Doe to submit to ABC lender.
5) Typically within 7 to 10 days - John Smith and Jane Doe receive the approval to sell the home at the current market value of $429,000 - Instead of "trying" to come up with an offer close to the $585,000 balance owed. Remember - Lenders receive subsidies for modifications AND short sales...)
Win - Win - Win - Win.....
And why would NaMoEx do all this work for free...?
Because our turn-key marketing programs will help Jane Doe create a "feeding frenzy" of highly motivated and qualified buyers - And hopefully a few of them will select NaMoEx as their lender...
Thanx, Danny
Danny C. Flucke Jr.
Senior Partner
Nationwide Mortgage Experts, LLC
Direct: (714)624-9479
DCFJ@NationwideMortgageExperts.com
www.NationwideMortgageExperts.com / www.NaMoEx.com
Submitted by Ronald Ogden on September 22, 2009 - 4:54pm.
Great information. Though I wish I did not have to work short sales, the reality of the market place dictates that I do. Sounds like a great book to recommend to my buyers who are on the fence about taking the short-sale route. Thanks!
Ron Ogden, Associate Broker
RE/MAX Metro - Salt Lake City, Utah
Salt Lake City Utah Real Estate: www.dwellutah.com
Dwell Utah Real Estate Blog: www.dwelltuah.com/blog