Short Sale Tip 1-14-10

Posted on 14. Jan, 2010 by ctlms in Short Sale, foreclosure

Foreclosures keep getting worse!  But you can HELP!

Recently released statistics reveal just how bad it still is out there.

A record 2.8 MILLION households were threatened with foreclosure last year.  That's up 21 percent from 2008.

In CT 25,211 foreclosure proceedings were started in the first 11 months of the year, up 28 percent for the same time period in 2008.

Nationally prices are down 30 percent from mid 2006.

The forecast is for 3-3.5 MILLION initial foreclosure filings in 2010.

So you have to ask yourself, "Why don't more of these homeowners do something to avoid foreclosure?"

Well if you look at the pitiful statistics for the administrations Making Home Affordable program, you can see part of the issue.

The program has approved "trial" loan modifications for 760,000 eligible borrowers since it's start last March.  But just 31,000 of those have been made permanent.  That means that just 1.1% of the 2.8 MILLION homeowners facing foreclosure have been given a permanent solution through these programs.  That is awful!

Now I think we can all agree that very few people would allow their property to be foreclosed if they knew there was equity in it that they would lose.  However it is much easier to let a house go that is under water.  So it would be fair to assume that the vast majority of the homes that are foreclosed have no or negative equity.

Traditional real estate thinking would suggest that there is nothing a real estate agent can do for that homeowner to help them get out from under that property and avoid foreclosure.

But that thinking is wrong.  Short sales are the answer.  A short sale is a win-win-win transaction, when successful.  The sellers avoid a foreclosure, the lenders lose less money and receive that money sooner, the market avoids another vacant bank owned property and the sale helps fuel the real estate industry and more.  The real estate agents, closing agents, appraisers, mortgage lenders, and even the towns get paid when that property sells.

Short sales are more and more becoming the tool that is helping keep the real estate market afloat.  The percentage of under water properties is huge and the only way those homeowners can get out from under is with a short sale.

Now I am not going to tell you that every short sale is quick, easy and successful.  But neither is every conventional sale.  But these homeowners need someone's help and they need it badly.

Are you going to be one who helps, or passes it down the line?  I have agents bring short sales to us to negotiate who have never before had a call from a homeowner in that situation.  These agents have been in the business for decades.  They know that these sellers need assistance and that there is a path that can be taken to give these people the best shot at avoiding foreclosure and salvaging as much of their credit as possible.  So they help.

Just this week alone I have gotten calls from 4 agents that we will be working with for the first time.  All of these agents have been in business for quite some time.  I also received a number of new files for agents we have successfully worked with over the last year.  The need is definitely there.

These deals are out there and they are ripe for the picking if you are willing to help those is need.  You can have no better referral source than a seller you helped avoid foreclosure.  I know this first hand.

So the next time you get a call from a seller that is underwater and/or facing foreclosure, remember.  There is something you can do.  Even if it is just to refer that client to someone who IS willing to help them.  Better yet help them yourself and earn your commission, it really is not much more work on your end than any other sale, if you work with us to negotiate of course.  You definitely don't have to worry about a stubborn seller, most of the time anyway.

Here is to helping as many homeowners as we can this year.  We can all do it if we work together.

Have any other questions on foreclosure or short sales?  Think you and your fellow agents could benefit from an office visit from us?  Give us a call or email us for more information about or office visits.  They’re free and always informative.

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