Tips to Avoid Short Sale Mistakes

by Bonnie Aletaha on December 5, 2011

Many distressed home sellers are discovering that it is not always easy to sell a home in a short sale. Short sales can be complicated and, if a seller does not handle the short sale properly, they could see their home lost to foreclosure. Short sale sellers come in all shapes and sizes and each situation is different, however, there are some pitfalls that all sellers should be aware of in order to ensure that their short sale closes.

The first thing a homeowner ought to do once thinking of listing their house in a short sale is to use a seasoned short sale realtor. Quite a few realtors are hurting in this economy, and they’ll frequently take on short sales though they possess hardly any experience. It is very important that the agent a seller selects has successfully closed short sales. If the agent hasn’t ever closed a short sale, next the homeowner should strongly consider using a more knowledgeable short sale agent. The realtors understanding of closing short sales is critical for a successful short sale, and lots of agents don’t understand the quantity of work involved with getting a short sale closed. The not so knowledgeable realtors generally lose interest and the short sale can finish up getting lost to real estate foreclosure.

Another common error homeowner’s make when selling their house in a short sale is listing the home at the wrong price. Pricing a short sale can be difficult, because they have to be priced competitively in order to compete with other non-short sale listings in the same area, however, it is unwise to list the home well below market value. Market value is key when negotiating a short sale with the bank. A short sale lender will not take more than a 10-15% reduction of market value. If an agent submits a bunch of low ball offers to the short sale lender, the bank will simply deny them and the house will most likely end up in foreclosure.

With good reason, homeowners who decide to short sale their property tend to be doing it under duress. These homeowners genuinely don’t desire to sell their house, but they want to avoid the property foreclosure, hence they pick the lesser of 2 evils. Difficult sellers make a mistake in not cooperating with the short sale process simply because they’re merely postponing the unavoidable, and more frequently these days, these types of sellers lose their houses in property foreclosure for the reason that they were not committed to the process at first.

These sellers usually have so many showing restrictions and make the house undesirable for buyer’s agents to show their clients. A short sale cannot close without an offer and if the seller isn’t willing to show the home to potential buyers then they may as well just let the house go in foreclosure. In short, it is critical for short sale sellers to do their research and stay committed to the process.

Want to find out more short saleinformation, then visit Socal Short Sale’s site on how to choose the best short sale agent.

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