We’re seeing a rising number of short sales this year, a trend that’s set to increase as we run through the summer. Short sales offer underwater homeowners a sometimes easier way out of trouble, allowing them to wash their hands of a property and start with a clean slate. Unfortunately though, short sales don’t always proceed as smoothly as we like – this kind of transaction can take up to three months longer than a regular sale, and during that time there’s lots of potential for the deal to go sour.
What follows are some of the most common delays that crop up during the short sale process, with a little advice on what agents can do to avoid them:
Real estate agents should make sure that a title exam is done at the start of the process in order to identify all persons named on mortgages and deeds, and to determine all lien holders on the property. This can save heaps of trouble later on should any issues crop up.
Lack of Communication
Specifically, we’re talking about lenders here. Misunderstandings and lost or incomplete documents can cause big delays in the process. Be sure to follow up at least twice a week with the mortgage service in order to keep on top of things.
The short sale process doesn’t even begin until a contract to purchase has been agreed upon and signed. However, lenders won’t even look at the contract until the seller has been approved for the short sale and the market value of the home has been determined, so make sure these are out the way first.
One of the biggest causes of delays is down to agents submitting incomplete packages, and so agents should take extra care to ensure that all documents are completed accurately and submitted without errors. In addition, all financial information about the homeowner and seller needs to be kept current, and should be forwarded to the lender every 30 days.
Failing to Build a Rapport
Agents should aim to develop a rapport with their contact at the lender as a way of building up trust and mutual respect – very important in what can be an extremely stressful process. Such a simple step can make things go much more smoothly should problems arise.