Was talking to an agent who advertises as a buyers agent for short sales. She has a huge following of investors now. Told me she never has less than 100 offers outstanding but only closes 3 to 5 per month. I have 33 years in biz and have done 3500 BPOs but very few shorts. Can you tell me why this ration should be so small? My only half educated guess is she shotguns lowball offers and they grab whatever works?
I know starving agents who would LOVE 3 to 5 commissions a month and would probably write 200 offers to get that but all in all what kind of time would it take to be actively in 100 offers out at any given time? Would it be worth it? Wouldnt all thse crap offers help clog up the system and make it harder for all the rest of us with legit offers?
Comments
My short sale ratio is fairly good. I always ask the bank, or have the negotiating attorney ask the bank, "what they will accept?"
Once we have an amount from the bank, we will not accept any offers less than that amount.
Also it will depend on the CMA of that property. If the CMA/BPO says that properties should sell for market value in under 90 days, there is no way a bank / lender will accept less then market value.
There are a few banks that have not provided us with an amount they will accept. and they do say Submit every offer and will look at them.
Keeping those offers HIGH is best for everyone, plus proof of funds, and or a full qualification letter submitted with the offer helps.
Remember the Short Sale Listing Realtor or REO listing Realtor is ranked by the bank on how close the offers are to the list price. If too many LOW offers and that bank may not assign any more listings to that Realtor.
Good Luck everyone
Interesting, thanks for all the input. Dont worry, Im going to leave you alone now, lol. Going back to my specialty that always worked for me no matter what---converting FSBOs. I hear there two or three of them in my state still trying on their own...happy sales
That's right, the bank is not a party of the agreement therefore, the seller still makes all the decisions, just like a traditional equity sale. Yes, it is a contingency sale. In my area, we call it "Contingent Short Sale Lender Approval". All we need the bank to do is tell us if they agree or don't and if they do, what those terms and conditions are. For all intents and purposes, it's a traditional sale with 1 major contingency, "short sale lender approval".
Ohhhh my Lord. I didnt know you didnt have to submit every offer. That WAS an important part of my thinking. There ya go! This is so interesting. The lender doesnt own the home and cant actually accept an offer to purchase, right? They are just agreeing to take whatever they get so their 'acceptance' is to do that if the offer pencils out. The actual owner has to sign and accept the offer just like a normal sale? Isnt it a contingency sale based on lenders acceptance of the terms? You can see I have no experience with these. Aside from offering price, Im guessing a buyers agent has to know more than just how to fill in the blanks on a deposut receipt, right? Sorry---didnt intend for this to become a teaching thread at your time expense! Whoever reads all this owes you gift certificates from a major candy store.
Marvin, I think you are missing a huge part. We don't send but one offer to the lender. We only send the wining offer. Keep in mind, these are short sales so, the seller makes the decision on what offer to send to the lender.
As for Bankruptcy, Deficiency, IRS and Relocation Assistance....yes, these conversations must be had and yes, I know A TON....IF NOT ALL OF THEM, agents who ARE NOT having these conversations. So, in that example, yes...they are opening themselves to huge liability. In fact, it's my policy that before we discuss a short sale, we first discuss bankruptcy and yes, we work closely with a bankruptcy attorney for those discussions.
Short sales are not easy transactions, short sales are not transactions that should be farmed out to 3rd party negotiators and short sales open uninformed or lazy agents to huge amounts of liability so, they should only be embarked upon by skilled professionals who have a support system of other professionals like, Attorneys and Accountants.
I really dont have much desire to do shorts. I agree (and I think I said a big CA atty is telling agents this) that an atty should be involved. There are many things to consider such as if a BK is needed, what type, dreaded IRS relief of income, deficiency, etc.
WHy I keep angling at the shotgunning lowballs is that it must take a lot of time andcause friction within the lenders office if they are hit with a lot of trash offers. I will still call them trash because the investor is simp0ly picking a 100 properties and telling the agent to throw out 100 offers at 40% (or whatever) less to see what crud sticks to the wall. Yes I know they can be ignored, etc but in the grand scheme of things it has to make it miore difficult for everyone in the process, correct?
100? Really? And you didn't discover that you were sleeping when she told you this? <totally kidding you>
Unless she lets the other Agent do all the work, I cannot even fathom having 100 buyers yanking on me at one time! 25 would be a possible achievable chore. Any more than that? (without a team??) uggh! Especially on short sales!
Ok….so, let’s discuss these “paid negotiators” in more detail.
Most of these third party negotiators like to tell unsuspecting Realtors that they want to free up the agent to do what the agent does best and that is, “work with buyers and sellers”….or something to that effect. I have many issues with this and let me explain why.
So, as you can see, I really am not a proponent of the negotiators and I do believe those that use them, are violating their responsibility to their clients by passing on their responsibility to someone else. The sad part is, when and if the crap hits the fan with one of those short sales, do you really think that 3rd party negotiator is going to have your back? ROFLMAO if you think so. THEY HAVE NO FIDUCIARY RESPONSIBILITY TO NO ONE. It’s all going to come back on the agent and how incompetent is that agent going to look or better yet, think about how an attorney is going to argue that they neglected their fiduciary responsibility and should be held liable?
If you are a newbie, SHORT SALES ARE NOT FOR YOU! Go get an education….several educations and then talk with a producing short sale agent and work with him for a while and when you’re ready, go out on your own. Stop trying to take the easy way out, stop passing on your responsibility to someone else. Just do your job. (sorry, I got a little carried away there)
As for low ball offers…..I really don’t understand why you keep bringing this up. You deal with those like you would any other transaction. Speak to your seller, explain why it’s a low ball offer, and follow their instructions. Chances are you will either counter them or reject them. Maybe I am missing something in your explanation but, I don’t have a problem with low ball offers, normally my clients just reject them and we move on with better offers.
All of my listings come direct from the owner. I do work with 2 referral agencies however, they don’t refer enough business to really even consider them. Most everything I get comes from my reputation, my website or other agents as a referral, of which I pay back a 25% referral fee upon successful closing. I don’t get any listings direct from lenders however, I am on the Bank of America site as an approved agent as well as several others. Of course lenders consider me just another cog in the wheel because, I am. In fact, I am an important cog because the homeowners is relying on me to complete the banks required paperwork, meet the banks required time lines and help them navigate their banks processes and procedures for a successful closing. The bank are relying on me to get as close to market value as I can. In fact, short sales don’t work with agents and therefore, sure….I am a cog in a machine or better yet, I am one member of a very big team of people; homeowner, bank’s customer service, bank’s collection agent, bank’s loss mitigation department, short sale processor, short sale negotiator, short sale quality assurance agent, short sale closer, title attorney, selling agent, buyer, inspectors, and other vendors. We are all working for the same reason and we are all cogs in a machine, we all have to work together or it doesn’t get done.
Agency is part of any deal you do in Tennessee. Our agency laws are specific and clear. That is why I spent have of this reply on the whole issue of fiduciary responsibility and liability. I strongly suggest that you don’t do a short sale unless you are an exclusive agent and NOT working with a 3rd party negotiator. Yes, I do have all my short sale closings completed by an actual attorney, not a title agent. This is because I live in a deficiency state and my clients need a legal opinion on their approval letters as to if the bank is walking away fully satisfied or not. Not to mention, the attorney is very helpful in answering questions of a legal nature that inevitably come up with short sales. My attorney doesn’t charge extra for his services, he considers it all a part of his job as the closing attorney for my clients. Now, he does charge a little more than he would a traditional sale but, we can all agree, short sales are more complicated and sure, he should charge a little more.
-
1
-
2
of 2 Next