Some Notes on the Joys and Terrors of Short Sales

May 24 Del Mar Hilton

I know your first reaction (as is mine) is always to say "Well don't they know if they don't take this - they'll get nothing?" The short answer is - yes they know - and NO, they don't care. It is a well planned out process of delays, distraction, and deliberate misinformation designed to take legitimate deals to the brink so that they can get the parties involved to agree to anything within their means.

We are all very emotionally invested in this process and hanging by a thread, while they (the banks) seem to just fritter away the day playing stupid. Again, they are not stupid. When this technique no longer works for them, they will change it. In the meantime, in their eyes anyway, it works. There will be last second surprises that will have to be addressed. They may ask for a promissory note from the seller, they may ask the agents to give up a little commission, they may refuse to pay this close cost or that.

The decisionmakers spend 75% of their time in meetings justifying why they took 10 cents on the dollar or whatever. If they can squeeze just one more drop of blood out of that turnip, they are heroes and slapping each other on the back.

That is the reality of it. I have a minimum of 20 of these things going at all times. Some lenders are better than others. Countrywide is the worst by far, with Chase (WAMU) being the next worst. The others have their moments.

There are quite a few agents and investors out there claiming to be short sale experts, claiming minimum trouble low stress deals. The reality is, the majority of all short sale attempts by agents end up in foreclosure. It's not because of paperwork, or because of lack of buyers. It is because the last mile is the toughest and people always lose their heads. Agents, buyers, homeowners, etc. They just can't take the anxiety and they snap. Recognize this and be prepared for it.

Brinksmanship is a HUGE part of this business. Try not to get involved emotionally. And don't do the business if you can't handle frustration and anxiety - if you take it personally. You will make mistakes. Admit them, learn from them, and work hard. It takes a bulldog to do this business!