Sometimes working with a specialist can really help one to save a lot of time and effort. Short-selling is a niche area of real-estate that IMHO requires a specialist, because there are so many moving parts and pieces, hard deadlines, and ways to get burned dealing with them. Check out Tina C Wong's and Frances Flynn's Trulia profiles and answers. I know how to work with short-sales (usually pre-foreclosures), foreclosures, and REOs; and I can also tell they know what they're doing by their comments.
Handling a short-sale isn't rocket science--although it would be much easier for me if it were--rather it's just a tedious, mind-numbing process of dotting every 'i' and crossing every 't'. Handling a short-sale consists of several steps: 1) negotiating with the seller and lender, 2) navigating and filling out the short-sale package (which is an art in and of itself), 3) collaborating closely with a title agent and/or attorney (often to help identify and remove each lien on a property one-by-one), and 4) working with a real-estate attorney to ensure one doesn't violate any "foreclosure consultant" laws (in states that have them). That's the bird's eye view, and the devil is in the details. Matters become even more complicated if the seller has already filed (or is contemplating to file) for bankruptcy.
My point is if you (or other agents) haven't handled at least 10 of these, then you (or they) should probably get some help to ensure that you don't overlook something. I've heard of several cases of a bankruptcy judge reversing a short-sale over minor details; keep in mind that a bankruptcy judge has the power to rollback any and all transactions +/- 6 months before the initial filing and after the gavel has fallen.
â€¢ The average short sale negotiator gets about $1K per closed transaction, some a little more, some a little less
â€¢ If you figure that the costs of running a business is about 20% (phones, internet, computers, office supplies etc), a professional negotiator would need to successfully close 100 transactions a year to make an annual salary of $60â€¦IF he or she closed 100% of the transactions, which just does not happen.
â€¢ For argumentâ€™s sake, letâ€™s say they close 80% which is pretty darn good. That would mean that in order to make a half decent living, the negotiator is working AT MINIMUM, 125 transactions a year!
â€¢ Since the average SS transaction takes over 4 months to close, itâ€™s safe to say that in this case, the â€œprofessional negotiatorâ€ has 40-50 open files on his desk at any given time! How is that beneficial to the buyer OR seller???
Now, you might make the argument that a professional negotiator has better systems than the average Joe, and that may be right, but no system can add hours to the clock! SSâ€™s require babysitting, thinking outside the box, and sometimes just sitting on hold for very long periods of time. There has to be a compromise somewhere, and that may be your file!
Iâ€™ve also heard the argument that PNâ€™s establish relationships with the bankâ€™s negotiators and therefore can cut through some of the red tape because of this unique relationship. While that may be true in some cases, it can also be a determinate:
â€¢ Sometimes familiarity breeds contempt. One bad day, and youâ€™ve made an enemy
â€¢ Bank negotiators burn out quickly! Iâ€™ve had cases where Iâ€™ve gone through three bank negotiators on one file.
â€¢ Sometimes the relationships get too chummy and the respective negotiators play â€œLetâ€™s Make a Dealâ€. Your file might get sacrificed in order to push another through.
I close over 90% of my short sales because I do my homework before I take the listing and I don't overwhelm myself by taking on too many.
As a listing agent it is more money out of your pocket to pay the negotiator and I'd like to see the statistics to show that a "professional" negotiator gets the deal done any faster than a diligent agent.