Short Sale Thoughts or Kay's Short Sale Rant of the Day

I seem to spend an inordinate amount of time on the phone talking with my seller clients who are going the Short Sale route trying to give them comfort in the process, offer them some tiny amount of hope that all will be well. The seller client may be different from call to call, but the conversation is nearly always the same.  Even though my Short Sale Negotiation Team is top notch, and I really mean that - they are amazing, it still takes heroic efforts on everyones' part to get these Short Sales done. What is the biggest stumbling stone? The banks. We submit detailed market analyses on all the properties, really hone in as if by crystal ball to give an insightful and accurate property value in this crazy market we have been "enjoying" the past few years. Then, the bank orders a BPO (broker price opinion) which sometimes is done "spot on" but many times we are seeing the BPOs come in at some blue sky high value that just is not going to happen in this market and the bank counters any current offer with some crazy high number. Buyer walks. We start over again. We get another contract, submit it to the bank. Bank takes their sweet time (ok, I acknowledge they are over burdened with files on a bazillion properties that are trying to go Short Sale to avoid Foreclosure) but seriously, we are waiting months, in far too many cases, for a response sometimes. I thought that was supposed to be speeding up. Hmm. Did I hear something about the government issued an edict that turnaround time on these files was supposed to speed up? OK, I'll not launch that argumentative grenade for now...by the time we finally get a response from the bank, many times the buyer has moved on since not everyone can put their lives on hold forever. Yes, the banks are in a very bad spot (no, we are not going to go down that line of conversation right now either, because this is one area just about everyone seems to already be in agreement on - let's sum it up to say we are all frustrated with the whole mess). I've been doing these Short Sales long enough now, with my team of expert negotiators, who by the way have taught me so much just interacting with them, that I really do "get" the process, the flow of things, the rhythm (actually sometimes in the lack of rhythm or a disjointed rhythm you can find a certain flow which may seem to the dear one who is sitting around waiting for some good news, any good news, like nothing is happening but those of us inside the transaction know things are happening albeit in a jagged, walking on shards of glass kind of experience, but things are happening) and all the while to our treasured clients (I'm very serious here - if anyone does not believe I treasure my clients then they have just not spent the time to get to know me or have not been paying attention) it feels like they have been abandoned by the world, well certainly by their lender. Why we all did not see this chaotic market coming I don't know. When you look at the history of it all, and think back on taking out a 100% mortgage and also running a home equity loan up to the max, we might have considered that it might not have been the best plan but with the appreciation we were experiencing, the prospect of being able to make money while providing a roof over your head, well, it's pretty powerful stuff.

As a seller, when you are going short sale: "It is what it is" can become your friendly mantra to help you through many of the situations that will arise in the process. If you are working with an agent who is committed to the process and to your best interest, is experienced in successfully closing short sales, has a brilliant negotiator on the team who is tenacious under all circumstances, then you are on the right path. Remember, no one has much influence over your bank. The bank is going to do what the bank is going to do but a great team can help usher the process along in a better direction for you. We are your advocates. Some experiences with banks are actually pretty good. They really do work with you and have responsive file managers on their end who function from a point of reality (big cheers for those).

If that is not your situation, and you have drawn the lot of the file manager who just does not seem to get it, then it's absolutely imperative you have an agent on your side and a great short sale negotiating team to work on your behalf. Besides, you have no idea how important it is to have your agent be able to decipher what all is going on and to tell you when it's really time to panic. Face it, a seller going through the Short Sale process usually feels pretty panic stricken the whole way through. Granted, it's not as much fun as going hand in hand down to Dairy Queen but there are times in a Short Sale transaction when the most important thing to do is to do nothing, to be patient even when it does not seem to make sense. A good agent will be able to tell you when those times are. A good agent will also be able to tell you when it's time to panic.

Also, remember that these Short Sales are time intensive on the part of your agent and their team. Most usually we end up doing about 3-4 times the amount of work in time and effort than on a regular transaction so if you call your agent and they just seem like they don't have time to chit chat - well, they don't. Every minute they are on the phone with you is one more minute they are not able to be pushing to get the bank to respond appropriately. Does that sound cold? I sure don't mean for it to, but in the context of this conversation and subject, let's be realistic. We are trying to fight for your ability to walk away from this as a whole person with the hope of restoring credit in a reasonable time and manner. This is crunch time people. Let's be honest about that. Nothing gives me greater pleasure than getting the short sale closed with my seller client walking away, no deficiency judgment, and able to start life fresh. Now that's when my sellers and I are ready and able to settle down for some fun moments together. That's when we can take time to smell the roses. Granted, there is an appropriate amount of consultation that needs to happen between listing agent and short sale seller client, but if you can possibly accept the fact that these banks move slowly and whatever you spoke with your agent about yesterday is not likely going to change overnight or even in days. The ideal arrangement for all parties is for the seller to find some way to remain calm and not panic over the seeming lack of activity (trust me, if your agent is really good at this there's plenty of activity - it's like the duck swimming on the water where it looks really smooth on the surface but underneath that duck is paddling like crazy) and just find a way to come to grips with the reality that you will be getting an email update every week letting you know where the bank is at in their process...or where they are not yet at, which is more often the case. Of course, the human relations aspect of things welcome a real live phone call between you and your agent maybe once a week or every other week unless there is something specific to address. However, let's manage expectations. For you to call your agent and expect that they are, as if by magic, going to be able to predict what the bank will be deciding and when they will make a decision is simply frustrating for you as a seller (because that agent is not honestly going to be able to predict anything the bank is going to do) and it is going to simply add to the potential feeling of hopelessness most Short Sale sellers experience. Then, there is the emotion of anger - "How did this happen to me?!" That is perhaps the most common one I help people through, or at least let them talk themselves through. Just remember, there is a light at the end of the tunnel and it is not a train....well, almost never is it a train. I've had some pretty challenging situations which my team and I have successfully gotten our seller clients through. I've got one right now that is challenging me to my core and if I could come face to face with the bank file manager on this one it would take everything I have to keep it civil, but I still think we're going to get it done for my seller clients.  If the buyer will just be patient on this one just a few more days I really truly think we'll get this one done, even though several times I've almost had to get out the paddles (you know, like on the tv hospital shows when they scream "CLEAR!" and zap the patient with the paddles trying to revive him).

One thing is certain in this market. As you stand in line at the grocery store, or in your work place with your colleagues, wherever you find yourself standing, stop a moment, take a breath, and just look around. I can assure you, you have no idea what the person next to you or across the room from you is going through right now, but I can almost guarantee that they are going through something. Something full of pain and confusion. Just about everyone I have encountered these past few years has a tortured night of the soul type of story about their own life experience now or in the past few years. So, when someone is snappy with you, or is not giving you what you think you need in this new moment to find that joy everyone is seeking, just remember this. It does not seem to matter how much money they have (or had) or how little, this market has touched every strata. The angriest, most frustrated person who is acting out right before your very eyes may well have just learned that their third short sale buyer has "walked" because the bank took so long to respond, or else the bank countered a perfectly correct offer price (based on market value) with some pie in the sky price that no appraiser could actually prove (another time we'll talk about drive-by BPOs - yeah, you people in the industry know just what I'm talking about - grrrr) and now this homeowner is yet one step closer to foreclosure.

Thanks for taking this ride with me while I rant. For all my short sale fellow warriors, be you agent, client, or the dear one who is just realizing the fear that is welling up in their gut telling them they may not be able to keep their house, hold the hope that tomorrow there is a brighter day because usually there is. Remember I am here, doing what I do, every day, ready to help guide you, encourage you, and instantly able to seek guidance from people way smarter than me when I run into some new thing that I just don't know how to solve myself. We are all surrounded by amazing resources. With my length and depth of experience in the real estate industry I have built quite a support infrastructure, and when I moved over to Keller Williams Realty I was surprised to learn how many additional resources became available to me. Did you know Keller Williams is the third largest real estate company in the USA? Seriously. I had no idea. I guess I'd just been too busy doing business and living life to keep track of that sort of thing. It is mentioned now simply because I am grateful to be in such a supportive, inspiring company which instills a high level of excellence in all things. Speaking of which, it's time to sign off for now as I get about the business of doing excellent work today. You bank short sale negotiators out there, after a good night's rest I'm back at it this morning, as is my team, and we're coming back to you at full force. My sellers? Hang in there. As ever, I'm at work this new day. Let's get good work done. Next time I'll talk about buyers who are buying short sales. Now that's a whole other layer of counseling involved in that process.

Have a great day - you deserve it! And remember, if you want to jot me a note, feel free. If you want to keep it private, just email me at russellgroup1@yahoo.com.