PROView - January 2008 - (Page 6) Make sure that all owners are in agreement on any action you will take. She cautioned that if a customer is reluctant to provide you with all necessary information, you may not want to pursue the relationship. “I always tell prospective customers that I will need to have access to all information and permission to speak with lenders and creditors on their behalf in order to work effectively.” She said that customers faced with a potential short sale are typically bombarded with phone calls around the clock from creditors and lenders. “You need to make sure you solidify your relationship to the point your customers know to refer all calls to you.” She added that your customers must be forthcoming with all information. “You as a Realtor® need to be in control; otherwise a sale is very unlikely to come to closing. In the end, you may have wasted a tremendous amount of time, effort, and often money.” Let’s say you’ve determined that a short sale appears to be the most prudent solution based on the information you have received. “Working with a title company, Realtors® need to put together a complete snapshot of a customer’s financial obligations and assets as well as information about the property”, said Luttman. So what exactly do you need? Once you have gathered bank and mortgage statements, tax returns, pay stubs, and any other financial documents, it’s time to start preparing a listing package. First, you ask a title company to do a title search. Provided you now have the property owner’s permission and written authorization to speak with lenders, you will need to research any tax liens, lis pendens, and home equity lines that may exist for the property. Next, you will need to explore whether any pre-payment penalty, negative amortization, or any other fees will be assessed when a home is sold. The quickest way to find that information is to order a payoff statement from the lender which typically has about a 7 to 10 day turnaround time. Also, you will need to request a title report and sign a short sales disclosure. Beyond the financial information you’ve received from the owner, you will need a hardship letter, stating detailed compelling reasons why they have not been able to keep up with payments. What is considered a compelling reason? “I tell my customers to be honest and detailed when they describe what led to their financial troubles. A lender wants to see sincerity, truthfulness, and also willingness to do whatever they can to work through their current situation,” according to Banville. She pointed out that most lenders will understand the loss of a job, death in the family, or illness. The hardship letter is an opportunity for a borrower to tell his own story in his own words. So how long should it be? According to Banville, the letter should be kept to one page – whether handwritten or typed doesn’t really matter. Preparation Sales & Marketing Once you’re ready to start marketing a property, anticipated to be sold as short sale, the listing on the MLS needs to reflect the difference from a regular listing. According to Kat McCoy, MLS Manager at the Suncoast MLS, many listings considered for a short sale have already been on the market for some time. McCoy mentioned that once a property is entered into the MLS, it is the listing agent’s responsibility to disclose the short sale, or possible short sale, information in the public marketing remark section. Special mention should be made to inform a cooperating Realtor® that in the event the gross listing commission is reduced by the lender, the same will happen to the offer of compensation. That information should also be shared verbally upon the first contact with a cooperating agent. A note about lender approval being required should also be included in the Realtor® remarks section. A common question I received from our members was what price a short sale property should be listed for. The answer, according to McCoy, is that any property you list should per the MLS rules & regulations be posted with the full gross listing price as stated in the listing contract. Any price changes will need to be signed by all parties using a status change form. Negotiation Banville said that communication is essential during the entire process. She cautioned that lenders may change staff and even the process for which they handle short (Continued on page 24) January 2008 6 PINELLAS REALTOR® ORGANIZATION http://www.suncoasthomeinspection.com http://www.suncoasthomeinspection.com
Table of Contents Feed for the Digital Edition of PROView - January 2008 PROView - January 2008 Contents Chairman's Notes Feature ProActive Marketing Finance Marketplace Analysis Home Sales Report MLS Update MLS Mind Your Manners Education Calendar of Events & Programs PROBiz Special Feature Brokerage Design New Affiliates and Members for 2008 PROView - January 2008 PROView - January 2008 - PROView - January 2008 (Page Cover1) PROView - January 2008 - PROView - January 2008 (Page Cover2) PROView - January 2008 - Contents (Page 1) PROView - January 2008 - Chairman's Notes (Page 2) PROView - January 2008 - Chairman's Notes (Page 3) PROView - January 2008 - Feature (Page 4) PROView - January 2008 - Feature (Page 5) PROView - January 2008 - Feature (Page 6) PROView - January 2008 - ProActive (Page 7) PROView - January 2008 - Marketing (Page 8) PROView - January 2008 - Marketing (Page 9) PROView - January 2008 - Finance (Page 10) PROView - January 2008 - Finance (Page 11) PROView - January 2008 - Finance (Page 12) PROView - January 2008 - Finance (Page 13) PROView - January 2008 - Marketplace Analysis (Page 14) PROView - January 2008 - Home Sales Report (Page 15) PROView - January 2008 - MLS Update (Page 16) PROView - January 2008 - MLS Mind Your Manners (Page 17) PROView - January 2008 - Education (Page 18) PROView - January 2008 - Calendar of Events & Programs (Page 19) PROView - January 2008 - PROBiz (Page 20) PROView - January 2008 - Special Feature (Page 21) PROView - January 2008 - Brokerage Design (Page 22) PROView - January 2008 - Brokerage Design (Page 23) PROView - January 2008 - Brokerage Design (Page 24) PROView - January 2008 - Brokerage Design (Page 25) PROView - January 2008 - New Affiliates and Members for 2008 (Page 26) PROView - January 2008 - New Affiliates and Members for 2008 (Page Cover4)
For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.