Montgomery, Chester and Bucks County - Short Sale Homes for Sale
Read this before you buy or sell a short sale home.
Whether you’re planning to buy a short sale home or put your current short sale home on the market, you’d be wise to do some research on the real estate listing agent who is handling the transaction and negotiating the short sale.
Who’s negotiating your short sale?
The homeowner, or debtor, can get the ball rolling by calling their creditor (bank) to begin this dialogue. Most creditors will want to see that a buyer has been secured, a sale price has been established, and transaction figures have been calculated. So unless you’ve sold your home yourself, it would be natural to turn to your real estate listing agent to handle the ongoing short sale communications with the creditors after the homeowner’s initial call. You hired that agent to sell your home, right? You and your agent signed a listing contract, your agent marketed your home, coordinated buyer appointments, worked with offers, and negotiated with a buyer’s agent on your behalf. And now it’s time to go to settlement. But wait, your home is being sold as a short sale, remember? That means that along with you and the buyer, your creditors also need to be onboard with this transaction. That said, it’s extremely important for the success of the transaction to know who’s negotiating the short sale.
Many agents today arrange for a 3rd party negotiating company to handle the negotiations. This can cost upwards of $5000 and unless you or your agent have stumbled upon a non-profit short sale negotiating company, these folks naturally expect to get paid. But the transaction is a short sale – there are insufficient dollars to cover all costs. So who pays this new, extra cost? To put it simply, the “transaction” pays the new cost and there are a few ways this could go…
1) The seller pays the fee for services rendered. But if the seller doesn’t have enough money to pay all their real estate related debt, how can they pay this extra fee? You may have to pay these fees from the relocation or HAFA monies you may be eligible for. Ask your real estate agent – he or she should be able to answer this for you.
2) The buyer pays the fee. But unless the buyer has money to burn and/or just really wants to be overly generous – saintly even – they will simply deduct the amount of the negotiating company fee from the sale price. Worse, many buyers won’t even consider these properties due to this extra expense. This can easily result in more time needed to market the property. It can also result in the property not selling at all.
3) The short sale creditors pay the fee, either via a buyer’s lower price (see 2 above) or as an additional charge at settlement. But these folks are already being asked to absorb a loss on the transaction. Now they’re being asked to pay a few more thousand dollars for that pleasure? Note: most banks will not pay this 3rd party negotiation fee.
There is another way, and it means your real estate agent will need to “duck back in”. Remember, your listing agent is being paid a commission… if the transaction closes. Make them earn that commission by either handling the negotiating with the creditors themselves or by paying the negotiating company fee themselves. Think about it, if your agent has “subcontracted out” part of the work needed to get you to closing, shouldn’t that subcontractor fee be paid from the agent’s already agreed upon commission? And here’s something else to think about: if your real estate agent is either unwilling or unable to handle your short sale without help from a subcontractor, do you really want that agent to be your agent?
So if a short sale is in your near future, be sure to find out who’s negotiating that short sale.
Why didn’t the short sale settle or close? What happens next?
It’s discouraging for all parties involved when a short sale transaction fails. As a seller it’s extremely important to not give up. Most real estate listing agents accept a declination from the bank as final. But rarely is it truly “final”. It’s a listing agent’s job to show the bank why they should accept a submitted offer. If a property has been priced right or has been on the market for some time and a fair offer was submitted, there is no reason the bank won’t accept the offer. The agent needs to get to the right person at the bank who actually has the authority to make a financial decision. Getting to the right person is the most important step in a short sale transaction! This is how I’ve been able to personally close more short sales than most Philadelphia area real estate agents.
The seller in a failed short sale transaction loses the most. Many sellers shut down and decide that their home “can’t be sold.” Not true! You just need to find the right PA short sale realtor – a realtor who has successfully closed PA short sales! When interviewing an agent ask him or her “How many short sales have you closed?” and ask for the list of property addresses. Sold homes are available in public records and is not proprietary information. If your agent cannot or will not provide answers to these questions, find another agent specializing in short sales who will.
Over 70 PA short sale homeowners with successful settlements.
Here is my list of successful short sale settlements since 2007. I’ve personally helped over 70 homeowners sell their homes via a short sale transaction and I can help you, too. Let’s get together for a free, no obligation meeting – tell me what you want to do and I’ll share with you what I’ve seen others in a similar situation do. It’s that simple… and our meeting doesn’t need to take very long… you share some info and ask some questions and I do my best to give you helpful answers. The upside? – you gain some good info on how the real estate and financing worlds work… how they really work. The downside? – I can’t think of one. Just give me a call at (610)864-9872 or send an email to Rick@ricksheppard.com.
List of PA short sale homes for sale and sold in 2017.
78 Almond Ct, Lafayette Hill – UNDER CONTRACT
906 Continental Dr. Harleysville PA 19438 – UNDER CONTRACT
Short Sale Home for Sale in Telford – SOLD in October, 2017
Short Sale Home for Sale in Pennsburg – SOLD in September, 2017
705 E. Parker St, Unit C2, Langhorne – SOLD in April, 2017
Here is what a few of my short sale clients have to say about my short sale experience…
Rick deals with reality. No smoke and mirrors. Gives the facts and the reasonable alternatives. Highly recommended for short sales and negotiating with lenders. Extreme people person with your confidence at the forefront. Likable guy by nature not by practice. Nick Fisher
Rick was such a breath of fresh air after the many months I had spent trying to avoid the inevitable – putting my house on the market. He made me feel comfortable straightaway. His calm and confident manner put me at ease immediately. Rick went beyond expectations in every aspect of the process. He kept me informed at every stage and he skillfully anticipated potential needs or concerns and addressed them to my complete satisfaction. Rick consistently and seamlessly managed the selling of my home. If you are considering selling or buying a home, make Rich Sheppard your first choice. I am taking this opportunity to publicly thank Rick for all he did for me and to happily post this recommendation for his services – Rick, you are Awesome, thank you! Bobbie Sanguinetti
I purchased a short sale property at Royersford. Rick was masterful at getting the job Well Done !!! Could not be more pleased. Has unordinary ways of pulling strings. Highly Recommended. Both Buyers and Sellers can benefit from his approach. Nelson Swartley
Rick was very knowledgeable, personable and timely on responding back to his clients. I highly recommend Rick for any and all real estate matters. He helped me on my short sale and was very proactive during the entire process. Cathy
Rick helped me through a most difficult situation in the short sale of my house. He overcame hurdle after hurdle but hung in there until the sale was complete. Claude Wilcox
Rick did an excellent job for me. I went through a short sale and his experience and knowledge made things go as smooth as possible considering the situation.
I had originally gone with another Realtor who had been in the business for more than a decade but had not done short sales. What a difference. She was an absolute disaster and had no idea of what was going on. Rick knew every step and guided me through what is a challenging process. Bill Linebarger
Rick was extremely patient and professional throughout the difficult short sale process. He not only had to deal with the primary mortgage but also the home equity bank and home owners association. Fabien Ortelli