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Trulia Chica…, Other/Just Looking in Chicago, IL

Is it guaranteed that the property will sell if it is a short sale?

Asked by Trulia Chicago, Chicago, IL Mon Feb 4, 2013

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Manuel Brown (312) 600-5710’s answer
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Dear Trulia Chicago,


While there are no guarantees a property will sell in a short sale, there are steps you can take to increase your odds.

I recommend the seller do the following:

1. Find an attorney very experienced in doing short sales. From my experienced the best and most experienced short sales attorneys take no monies the seller. They will get paid at closing as part of the closing. The attorney does not get paid unless you close. My favorite firm is Gardi & Haught, LTD. http://www.gardilaw.com/.

2. Find a realtor with experience in working with short sales. The realtor must know the pulse of the market your property is in order to determine at what beginning price to list your property and if you are getting no activity on your property your realtor must have pre-research what was the actual closing price of similar properties that were closed in short sale and/or foreclosure. The bank is going to want to see that there was a real solid attempt to market and sell the property at the current fair market value. Just know that often the properties in short sales can sometimes sell for less than 30% of market value that is why it is so important your realtor has completed the research on closed short sales for your market. For example you have a 10 block radius and the average listing price of a two bedroom / 1 bathroom condo is $200,000. However, when you dig deeper into the stats you find out the average closed price on short sale for the area is $150,000. This is why it is important to have a very sharp realtor working with you.

3. Home seller I know this is a very difficult time and can be very embarrassing. Do not fret many people have had/ will have to do a short sale to put them selves in a better financial situation.

4. Make sure you keep your home clean and clutter free during showings to increase the chances of obtaining a buyer sooner.

5. If you are financially capable of paying your mortgage and your mortgage is simply upside down you will not qualify for a short sale. Speak with an attorney.

Finally, even after all the above has gone smoothly, once the buyer has put in an offer and the seller accepted it; now comes the time for the mortgage holder (lending institution) to determine if the selling price in contract is a price they are willing to accept. The bank will order an independent BPO (Brokers Price Opinion) on what the broker feels the property is worth based on the housing economic market factors of where your property is located. If your buyers has offered less monies than what the BPO comes back as the buyer has the option of accepting the banks price or walking away from the deal.

A short sale can be a very emotional and lengthy process. Surround yourself with professionals who are not just looking at a commission but the end result of getting you out from under the financial burden you are in.
4 votes Thank Flag Link Tue Feb 5, 2013
65% of short sales do not go through. Roughly the general idea is a 30% don't go through because the buyer bails because of the time involved or they find something else. 25% don't go through because the bank is looking for a price that the buyer does not want to do. And the 10% don't go through because the seller is uncooperative and won't show the property or won't provide the paperwork they seller wants in a timely manner.
1 vote Thank Flag Link Mon Feb 4, 2013
I will buy your short sale! Email me at Brianandjulieb@aol.com
0 votes Thank Flag Link Sun Apr 7, 2013
Well, I do have to say that I do disagree with some of the posts in response to your question. You may want to read my article on "How to Avoid Foreclosure by Short Selling Your Home" on Trulia as well as http://www.ShortSalesNews.net. Once you can find an experienced Real Estate Broker, he or she will help you through the process to determine your options. It will be your bank who makes the decision about whether you are eligible for loan modification. If you still wish to sell, you may. So, even if you did qualify for a loan modification, you may choose to request the Short Sale anyway. (The last time I checked, this is STILL America, and we are STILL free to sell our home even if it is a Short Sale.) Of course, your RE Broker should be aggressively marketing the property at market value, and aggressively adjusting the price at reasonable intervals in order to bring in a buyer. But, how fast this happens does depend on the experience of the list Broker. As for "guaranteeing" the property will sell, anything will sell at a price. It may take time and ingenuity to get it sold, but again, much of a successful Short Sale depends on the list Broker. So, choose one wisely, make sure this person is negotiating in good faith and in your best interest, and get your papers all in order. With an experienced RE Broker, you'll be packing soon! Good Luck!
0 votes Thank Flag Link Fri Apr 5, 2013
no guarantees, what's important? Investor, servicer of the loan, an offer itself, RE agent and the least important an attorney! Why attorney? Because RE agent should be the one who process the sale not an attorney!
0 votes Thank Flag Link Wed Feb 20, 2013
There is certainly not a guarantee the property will sell. Many times the seller can not in fact do a short sale since they do not have a true hardship the bank will accept (i.e loss of job, going to be on a lower fixed income, medical bills) and are merely trying to get out from under a property that is not worth what they paid for it.
0 votes Thank Flag Link Wed Feb 20, 2013
Definitely not guaranteed but there are steps that you can take to improve your odds.

1. Make sure that you qualify as a hardship.

2. Ensure that your initial list price reflects market value. Have the comps to support the list price and the accepted offer price.

3. Keep in mind that the goal is to sell the property not just to get an offer. Don't be tempted by a lowball offer. It will just be a problem in the future.

4. Stay in touch with your seller and the buyer's agent. The buyer's agent is key in making sure that the buyer hangs in there.

5. Make sure that both buyer and seller are prepared for the process. If the buyer has indicated 30 day close date in the contract, they may not be educated about the process or they may not be willing to wait. Test that by making sure they agree to more appropriate time frame.

Short sales do close. Sometimes the reasons for failure are beyond the control of the listing agent and attorney. Oftentimes though, failure can be avoided by optimizing the situation. Short sales are usually better than going into foreclosure if possible.

Good luck.

Millie C Lumpkin, CDPE, SFR
Keller Williams Preferred Realty
Orland Park IL
Email: millie.lumpkin@gmail.com
Phone: (312) 217-5644
0 votes Thank Flag Link Mon Feb 18, 2013
It's possible that the property will eventually sell, but it's not guaranteed that the bank will approve the short sale.
0 votes Thank Flag Link Tue Feb 5, 2013
No Its not guaranteed... But one of the most important things is to be represented by good experience Realtor . Also the key for successful short sale is a good attorney.
Thanks
Maja

The best attorney:
Marc Cervantes
Attorney at Law
Cervantes & Cioffi LLP
111 W. Washington, Ste 1201
Chicago, IL 60602
(o)312-606-9529
(F)312-606-9522 (NEW)
0 votes Thank Flag Link Mon Feb 4, 2013
There are never any guarantees in selling your home via short sale. The only thing you can do is prepare for the worst and the best will take care of itself. Good luck!
0 votes Thank Flag Link Mon Feb 4, 2013
There is zero guarantees in short sales.
0 votes Thank Flag Link Mon Feb 4, 2013
No. The lender(s) may not approve the short sale - for example, if the seller doesn't qualify. Also, the lender may want more than what buyers are willing to pay, etc.

Or, the seller may decide to try (and get) a loan modification.

Shanna Rogers
SR Realty
http://www.RealtyBySR.com
0 votes Thank Flag Link Mon Feb 4, 2013
No it does not. The seller can get a refi and if it is approves, there is no sale.
0 votes Thank Flag Link Mon Feb 4, 2013
Absolutely NOT guaranteed. Even if your price the house properly and you find a qualified buyer and your client agrees, it does NOT guarantee that the seller's lender will approve.
0 votes Thank Flag Link Mon Feb 4, 2013
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