Queens, NY · Member since 2012 · 16 posts · 0 votes
I was talking to a couple of agents who specialize in short sales and they both seem to be under the impression that in 3-4 months the banks are going to drastically limit the number of short sales they allow.
They're not the only ones who have echoed this sentiment. My question is for people who deal with a lot of short sales, is how do you think the next few months will pan out?
I know no one has a crystal ball, but do you think it will be worth it to still market to 60/90 day lates or would it be better to focus on other areas if the case really is that the banks wont be allowing as much?
Real Estate Agent · Manchaca, TX · Member since 2012 · 5 posts · 4 votes
13y
Alex,
I've spent the last 2 years (almost) specializing in short sales and I just closed a nightmare of one that took 14 months with B of A. Over these last 14 months of hell, I spent some time talking to our processor who said their department is slammed with pre-foreclosures. She alone had 80 files. Like the previous comment, banks don't want to hold on to the real estate so I think they'll continue on for as long as there is a need. As for me, I'm contemplating a career change. Ha!
Katherine Grote
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
13y
I've heard people speculating this for over a year. Banks don't want the houses, so they're going to continue doing short sales as long as the foreclosures keep rolling in.
Real Estate Agent · Manchaca, TX · Member since 2012 · 5 posts · 4 votes
13y
Alex,
I've spent the last 2 years (almost) specializing in short sales and I just closed a nightmare of one that took 14 months with B of A. Over these last 14 months of hell, I spent some time talking to our processor who said their department is slammed with pre-foreclosures. She alone had 80 files. Like the previous comment, banks don't want to hold on to the real estate so I think they'll continue on for as long as there is a need. As for me, I'm contemplating a career change. Ha!
Katherine Grote
Tallahassee, FL · Member since 2013 · 108 posts · 55 votes
13y
Short Sales will continue for years to come. Every week we speak to someone whose property doesn't show up on any distressed list, because they are still current on their payments. And they haven't hit the proverbial wall. The call goes like this with Doctor Soandso:
me: Hello, how can I be of assistance?
Doc : I was referred to you by another doctor in my practice. I have a property that is 50% under water and I have 6 months in reserves. So now I need to do some thing.
me: ok up to this point what has been your exit strategy?
Doc: well I hoped the market would come back.
me: so your 50% underwater, and you were hoping the market would rise 100% from current value, simply to sell the property for payoff?
doc: umm I guess.
me: did you buy all the comparable properties in you area,
Doc: No way!
me: Hmmmmm for one to believe the market will return 100% over a short period of time would take advantage of the great return.
doc: oh i see...
me: so you really didn't believe your property would appreciate enough to payoff the loan, if you did you would have taken advantage of the opportunity on comparable properties.
Doc: I guess that makes sense. But what about all the money I have put into the property; I don't want to just walk away from that.
me: sir that horse has left the stable. its gone.... if you don't actually believe the property will appreciate to a point to payoff the loan, how will it appreciate to a point... to not only pay off the debt... but also return all your carrying cost?
Doc: well...let me think about all of this and get back to you.
me: I will start a file and put it on the corner of my desk, for when you call back.
The point here is, everyone hits the wall at different points in time. Because of this there are properties that haven't been identified as distressed, but will hit the market as distressed at some point.
Its simply the three stages of property grief:
Denial: I hope the market comes back.
Anger: I will call the bank and see if they will work with me.
Acceptance: I have to do what ever it takes to free myself from this nightmare.