You may see a short sale as a low cost sale and a foreclosure alternative, but several primary stakeholders influence the process and the outcome of a short sale.
There are four seats at the Fullerton short sale bargaining table and problem can arise from any one of them but the player in this high stakes transaction that usually cause the most damage to an otherwise smooth transaction is easily identified as the loan servicer.
First let’s look at the four above mentioned horsemen familiar to all experienced Fullerton short sale agents. The realtor with the right skill, experience and negotiation strength will prevail more often than the novice short sale listing agent.
Rider #1: The Fullerton Short Seller/homeowner. This is often the most ready to cooperate of the four. The homeowner just wants a chance not to go into foreclosure and is ready to help in the sale of the home. The seller may not have any idea that the other three players each have some kind of cause and opportunity to make life absolutely impossible for the homeowner sometimes for no other reason than to make a last minute “adjustment” to make the books look a little better for any number of reasons.
Rider #2: The buyer. Wants to get a great deal on a home. May have misconceptions about the whole process. Often thinks that this is an opportunity to “negotiate” a hard deal- a lowball offer or bring demands as if they were in control of the process and at an extreme advantage over the “distressed homeowner” and may even perceive that the “bank” is desperate to sell the property at the best price. Sometimes this isn’t just the buyer, but also characteristic of the buyer’s agent if that agent is inexperienced in dealing with short sales.
Rider #3: The investor. The pale horse. This stakeholder would initially appear to be the “real power broker” in this crucible called a short sale. They’re the good guy. The investor is the one who signs the approval. Then the short sale should be a done deal but often investors are too far removed from the picture and retain too little control over the day to day management of their own investment to effect their own desired outcome. Even though short sales typically close substantially higher than foreclosures, there is someone seemingly just waiting to torpedo the whole deal at every step in the process.
Rider #4: The loan servicer. This is usually where the horror stories come from in short sales, You may have heard how “horrible banks can be” in short sale transactions. These are not the actual owners of the mortgage- that would be the investor, rider #3. These are the headless horsemen of the housingpocalypse. They don’t care about the buyer, the seller or even the investor. They care about their own, their books, their P&L statements, their stockholders and sometimes they don’t seem to care about anything at all and botch the transaction by simply failing to lift a finger to prevent foreclosure long enough to achieve a better transaction in return. This one player, this one entity is probably the source of nearly all failed short sales. The landscape is littered with their unsuspecting victims of 11th hour demands, surprise foreclosure proceedings that were supposed to be suspended and a myriad of changing terms and added expenses.
An experienced Fullerton short sale agent is needed to give you the best chance against the four horsmen short sale scenario. One who is accustomed to things that tend to cause problems if nobody knows to check on them and ask the right questions of everyone involved.