Short Sales
I have had some experience with short sales both in representing the seller and in representing the buyer of a short sale home. When I represented the Seller, in the past 2 instances, when the market was in the tank the last time, I worked with a person who only does short sales and has great contacts with banks. He is very honest and after talking with the seller and finding out some information, he will tell them if he can help or if he can't. When he said he could help, he did. In both cases, my sellers walked away from $40,000 and $25,000 worth of debt and never owed the bank another dime. I sold their places and in one case the seller bought another place that they could afford, shortly after the closing.
In the cases when I worked with the Buyers and an attorney was in charge of negotiating, they ended up in total disasters. Both times, we ended up on closing day and in one case at the closing table, only to find out there would not be a closing, because there was not enough money going to the bank to close. You can't imagine the devastation that caused with the buyers having already closed on the home they were in, their belongings packed in a moving truck and noplace to go. In one case the attorney representing the seller had petitioned the court to stay a foreclosure and had the seller paying the bank $1600 a month to keep the debt from mounting. When questioned about what happened, his answer to the seller was, " What did you think was going to happen, when you didn't pay your bills?". Nice huh? The seller gave my buyers permission to move into the house, because they had a young child and a dog and we continued to try to work it out. I told the seller to call the person I knew to help, instead of using the attorney anymore. She finally did, but too late. The day he called me to tell me he had it worked out, I had found my buyers another house and it was too late to get out of it.
So, just a couple of words of warning:
Sellers: If you find yourself in the position of having money problems or if you have to sell and don't have enough equity in your house to close it, make sure you talk with someone who is reputable and knows what they are doing first.
Buyers: If you are considering purchasing a home that is going to be a short sale, make sure you find out all of the facts as far as who is doing the negotiating. If it is an attorney or if someone is negotiating directly with a bank, get your attorney involved very early in the process, so someone can keep tabs on what is going on. Don't end up on the day of closing with nowhere to go.
If you have questions or would like some help, please feel free to call me at 860-301-3618 or send an E-Mail to me at Marabeth.Gildersleeve@CBMoves.com.
Post a comment if you have had any experience with this issue. With the market changing and all of the new mortgage programs outh there, we may be finding a lot of people in trouble.