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Buying a home in Sonoma County?
Unique Service: Short Sale Buyers
Short Sale is used to describe a sale of property for less than is owed on its mortgage.

Ask Realty OnlineI became a Certified Distressed Property Expert® (CDPE) in 2009 -- meaning that I completed specialized training to have a better understanding of  the complexities of the mortgage meltdown phenomenon and the unique needs of a homeowner who could benefit from doing a short sale.  

However I avoid dual representation in all transactions, so I've focused my knowledge and understanding on representing the buyers of short sales rather than sellers.  However, if you are a seller, you can still give me a call, and I will refer you to a an agent with short sale experience and expertise who can provide you with first-rate representation — a successful short sale does required skills that not all real estate licensees possess.

My first step in representing the buyer of a short sale is to qualify the property's desirability based on details related to the agent, the seller, and the lender, as well as the home itself.  For instance, a seller without a genuine commitment to selling may use an inexperienced agent to put their home on the market, when what they truly want is a loan modification; but they may begin soliciting offers in the meantime just in case the modification doesn't work out.

Does the listing agent understand the process? Who is the seller's lender or loan servicer and what is their reputation for efficiency at processing these transactions?  How far along is the seller in the process of negotiations with the lender?  Have they applied for a loan modification and been refused?  Does their agent seem genuinely dedicated to managing the demands of such a challenging transaction?  

Some traits common to all short sales that should be understood (by both sellers and buyers).

  1. There are least three (and often more) principal parties involved in a short sale: the seller, the seller's lender(s) and a buyer.
  2. Advertisement as a short sale does not mean that the lender has consented to the price or that they've even agreed to allow the property to be sold for less than is owed.
  3. Though the property owner makes the decision to put the home up for sale, final sale approval is the lender's decision.
  4. Before the lender will agree to a short sale the seller must submit extensive documentation, like a loan application process but in reverse — to verify that they genuinely can not afford to own the property. Some sellers never seem to get these materials together.
  5. Many lenders will not even review this documentation until after submission of an offer
  6. The seller may find tax consequences resulting from debt forgiveness are unacceptable
  7. Many hindrances may arise to cause the seller to abandon the sale during the marketing or escrow process:
    • the lender may insist they remain liable for the difference between the sale price and what's owed
    • a second mortgage lender may refuse to cooperate making it impossible to convey clear title
    • a Homeowners Association who has a lien on the property may refuse to cooperate
    • inaccurate information included on the owner's original loan application may become a problem
    • the lender may determine that the owner's other assets disallow qualification for a short sale
    • a loan modification that they have in process may go through
    • a foreclosure may simultaneously be in process and occur before escrow can close

Do not be seduced by a property's 'to good to be true' advertised price — it may be virtually meaningless.  Make an offer only if you are genuinely interested in the property for its own sake, or if a disinterested investor with no emotional investment in the outcome.  Whatever your motive — patience and a tolerance for uncertainty are key ingredients — I know of short sales that have taken over a year to close.  Whether you choose me or another buyer's broker to represent you, select a professional who understands the importance of establishing rapport with the listing agent in the very beginning and that working as a team is crucial to producing a win-win outcome.


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Sebastopol, California 95444
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