You’re in need of real help, real fast.

So guess what else you’ll find in the mail?

1.  Letters from people claiming that you can walk away by quit-claiming your property to them.  SCAM.

2.  Letters from people claiming that they will delete your mortgage if you give them 50% ownership of your property.  SCAM.

3.  Government style letters claiming to help you obtain ”government loan modifications and/or short sale assistance.”  SOLICITATION FOR BUSINESS.

4.  Investors claiming that they’ll “buy your house” in 7 days.  QUITE POSSIBLY A SCAM.

So you go off searching for “Seattle Foreclosure Help” on Google and you again run into people promising to buy your property from you or “save your home and prevent foreclosure.”

Now not every single company promising to save you from foreclosure is attempting to scam you, but you must keep in mind the key differences between a company that’s going to actually help you vs. a company that’s out there to rip you off.

And you know what that is?

It’s a track record.

Has the company closed at least 75-100 short sales?  What is their average success rate?  Of all of the loan modifications that they’ve negotiated, how many of them have been permanent? Are the companies promising to repair your credit comprised of actual attorneys experienced in litigation or random people off of the streets?

These are questions that you absolutely must be able to answer when seeking to avoid being another Seattle foreclosure statistic.

As the owner of Short Sail Solutions (a nationwide network of short sale experts), I have spent the last few years partnering with the best companies out there with the strongest track records, who are now ready and available to help you avoid foreclosure and walk away from this season in life with as little damage as possible.

We have experts all over the nation designated for the following areas of interest:  Short Sales, Loan Modifications, Credit Repair, Debt Settlement & Legal Counsel.

If you need help, simply scroll to the top of this website and click the tab that best addresses your need.

One free phone call with an expert may quite possibly save you from foreclosure.

And remember, when something sounds to good to be true, it probably is.

There is a reason why the Attorney General wrote me a letter commending my business.  When homeowners are in pre-foreclosure, the last thing they need is another person trying to take advantage of their distressed situation.  Yes it’s important to get help, but it’s even more important to get it from the right people.

Be wise,

Kevin Kim

In fact, I have personally witnessed these kinds of Realtors myself and words cannot describe the frustration that this causes with every party involved, from the bank to the negotiators to the buyers.

Here are the top 5 most common mistakes that BAD Short Sale Agents make that have ended up costing clients their home to foreclosure.

1.  Zero communication. When a short sale agent does not actively communicate with every party involved, from the negotiators to the sellers to the buyers agent, everyone assumes the worst. This causes a number of problems, from the buyer losing faith in the transaction to the negotiator simply being stuck at a particular stage in the short sale due to a lack of feedback from the agent.

2.  Laziness. When the short sale agent is lazy, nothing gets done.  For example, homeowners are often confused as to how to fill out their “short sale package.”  When the agent does not actively review the short sale package to make sure it is accurate & complete, the package ends up being returned & resent a dozen times before the bank ever receives it.  Also, there are action items that agents must carry out on a weekly basis, from price drops to making sure that buyers & their agents are being taken care of.  Agents cannot simply sit around for a buyer in a short sale, since buyers generally lose steam very quickly with these transactions. A short sale agent is not only a salesperson, but a transaction manager, and the agent is responsible for juggling every aspect and make sure everything is going smooth, or the transaction can very well collapse.

3.  Weak marketing & consulting skills. Again, buyers lose steam very quickly with these transactions.  A bad short sale agent will make the mistake of simply listing a property, asking for an offer and taking the first one that arrives to the table.  Like any good salesperson, the agent must have a strong marketing strategy in place to generate a large amount of buyer interest.  Thus, the agent must carefully choose the right offer that is most conducive to a quick closing.  After that, the agent must hold that buyer’s hand, even if they have a buyer’s agent and do everything possible to retain them as buyers until closing.  This is not an easy task and is only accomplished through an authoritative yet consultative style of communication.

4.  No experience. To this day, I still do not understand why agents attempt to negotiate their own short sales, when there are teams (like ours) who have collectively negotiated over a 1000 short sales with a 95%+ success rate.  To try and negotiate a short sale with no experience is like getting into the ring with a trained boxer and attempting to beat them, even if someone else’s livelihood is on the line.  It is downright foolish, since most negotiation services are free to the agent.  A successful short sale agent will not negotiate their own short sales, but rather will hire professionals to do the negotiating so that the agent can focus on the agency work.  In order to negotiate short sales, one must have a proper understanding of mortgage/foreclosure/bankruptcy law, negotiation dynamics, lender communication methods, insight on the lender’s best and worst alternatives “in the event of_______,” so on and so forth.  Explaining all of what a negotiator needs to know could be an entirely different article.

5.  Being too anxious. When the agent is too anxious, lenders hate it, buyers lose faith and sellers have no peace of mind.  Do not be anxious because it produces no results.

So what should you do if you are working with a short sale agent that is actively making these kinds of mistakes?

Don’t drop them if the agent is willing to work harder.  Yes, don’t simply terminate your agency agreement and go on looking for another Realtor in the middle of a short sale.  Transitioning a short sale file from one Realtor to another Realtor is a headache and when time is of the essence, transitioning Realtors is simply not functional.

Rather, my recommendation is that you kindly but firmly ask them to work with a professional short sale facilitation team, who will aggressively instruct the agent on what to do, how to do it and when to do it.  They will know exactly what to tell the lender, the buyers agents, escrow, etc. to keep the transaction afloat.  They would also take over the negotiations with the lender at no charge to the agent (apart from a few rare exceptions).

If the goal is to close the short sale, it is best that you give your agent the chance to carry out their fiduciary duties without “performance anxiety,” and the only way to prevent that is to have a professional take over the file and provide positive encouragement to that agent.

I have seen the worst agents close their short sales with the help of a strong short sale facilitation team.

Quite frankly, nobody is perfect, so my philosophy is two fold:

1.  All agents deserve grace and none are perfect.  You will never find a perfect agent.

2.  It is better to empower the weak agent with the tools to close the short sale then to have a strong agent take over and be overwhelmed with a “short sale in progress,” especially when strong agents are typically very busy people.

If you do not have an agent yet, you are in luck!  We have a  network of agents that can help you close your short sale.

You can request a consultation session with my short sale facilitation team by clicking here.

Remember, the key is to work with a strong short sale agent or to empower your current short sale agent with a strong team of negotiators.  Either way, make sure that you have one of the above professionals working on your behalf and you should be well on your way to closing your short sale and walking away from this season in life.

SSB

Click the above link for a live podcast featuring myself & Derek Johnson, the “Mod Reporter.”  In this clip, I discuss the ins and outs of how to determine whether a short sale is truly “in your best interest.” 

Enjoy the clip!

Kevin

Bad advisor:  “If you can’t get the lender to waive the difference in a short sale or deed-in-lieu of foreclosure, just have the lender foreclose on your property.  In a non-judicial foreclosure, the lender won’t be able to pursue you for the difference.  Although they may report a foreclosure on your credit report, at least you’ll be able to walk away owing nothing to your lender.” 

Friends, this is simply not true!

Click this link:  https://www.courts.wa.gov/content/Briefs/A08/798753%20sarich%20respondent.pdf

The above link leads to an actual case (Sarich Vs. Beal) which took place in the WA State Court of Appeals in 2007.  This case specifically addresses the junior lienholder’s ability to pursue a deficiency judgement in a non judicial foreclosure.  Read the document and never again consider letting your property go into foreclosure.

In summary, it was decided that junior lienholders (2nd purchase loan, HELOC, etc.) can pursue you for a deficiency at foreclosure, even in a non judicial foreclosure proceeding.

Keep in mind that exemptions exist.  You may want to ask an attorney or a local HUD counselor what the statutes of limitations with respect to mortgage deficiencies are in your state.

However, just because your property enters ”non judicial foreclosure,” does not automatically mean that the junior lienholders are stripped of their rights to pursue the deficiency.  Keep this in mind before considering allowing your property to go into foreclosure. 

Until next time,

Kevin

My answer to them is, “get the facts and trust your instincts.”

Here are the facts:

Effects of Short Sale on your Credit Report:

• 85-160 point reduction on your FICO score, depending on the borrower.
• Inability to obtain a mortgage for at least 24 months.

Effects of late payments on Credit Report:

• 30-60 day late payments, if considered an “isolated occurence” (you do not have 30-60 day late payments on multiple accounts), does not cause long term damage to your credit.
• 90-120+ day late payments, however, do drop your credit score for the long haul (around 7 years).

Effects of Collections (post Short Sale Deficiencies) & Debt Settlement

• Your score from suffer with both, except with debt settlement, you’ll eventually repay your debt and thus helping to rebuild your credit score
• Do not simply leave your debt hanging with collections in hopes that they will charge off the loan.  They will continue to report that you are in default of “installment payments,” etc.  They can do this for years.  It is better to settle your debt and move on.  You especially do not want additional 90 day late payments reported as your credit score at that point will drop significantly.

Here is my opinion:

Many homeowners end up spending all of their savings and living expenses on their mortgage payments, in the name of “protecting their credit.”  Some are even borrowing money (using lines of credit) to pay back their mortgage. Little do they know that they are probably not accomplishing what they think they are accomplishing by paying their payments.  Moreover, mortgages are not designed to replace your groceries or gas in your vehicle, and if that is the case, the homeowner either needs to get their loan modified or simply let go of the property (given their situation isn’t a consequence of some unnecessarily large personal expenses, ie. gambling).  The mortgage is not right for them.

Homeowners must ask themselves, then, is it really worth paying their mortgage if you are already 90+ days late to preserve their credit?  How about if you are current, based on the facts, do you have some wiggle room to reserve money to pay down other expenses? Aren’t you simply paying your banks rent money until you close your short sale?  Are you supposed to be neglecting your daily necessities just to pay your mortgage?  As far as loan modifications, did you know that late payments can be wrapped around the mortgage balance once you start your new payment plan?

Ask yourself, what could you do with a couple months worth of mortgage payments?

I’ve got some answers.

1.  Pay off your loan mod fees (although our short sale negotiators are paid by the lender, unfortunately loan modifications do not work that way)

2.  Reserve money to pay your debt negotiation specialist who can help negotiate your post short sale deficiencies (becoming much more common), consolidate all of your other unsecured debts (credit cards, medical bill, small loans etc) and repair your credit

3.  Spend it on daily necessities.  Do not sacrifice meals to pay your mortgage because that mortgage (as is) is not right for you.

Is it smart to spend money on money that has clearly no return on investment?

Is it smart to save money in order to save more money in the long run?

Should you keep paying your mortgage payments?

The answer:  Get the facts and trust your instincts.

Questions to think about:

Are you having trouble with any particular lender?  If so, who and why?

Is the lender not accepting your short sale even if you believe it is full price? 

Are lenders giving you the “run around” with their loss mitigation department?  Are you having a hard time reaching somebody who can help you? 

Have your local HUD agencies been helpful assisting you with your loan modification?

Have you had any bad experiences with non-profit/for-profit loan companies?  Bad experiences with short sale agents or negotiators?   

Are you having a hard time holding onto buyers for 3-4 months until short sale approval?  What have your been experiences been like with the lender once they know the buyer is off the table?

Is the lender being frustratingly persistent about charging your homeowner with a deficiency judgement or note for the difference between your sales price and the loan amount? 

Just some questions to get you thinking.  Post away!

As you may know, lenders send out appraisers to gauge the market value of a property during a short sale, which in turn helps them make their decision on whether to approve or disapprove of a given short sale. 

Following are reasons why this gentleman exemplifies the characteristics of a successful short sale agent: 

 1.  He carried out his due dilligence on behalf of the distressed homeowner and was fully prepared not only for the BPO, but for potential buyers/investors and anybody else that would be interested in purchasing the property.  

2.  He helped the BPO Agent gauge the true market value of this property, which in turn gave the bank a more accurate understanding of the property undergoing the short sale. 

3.  He prepared written proof of everything that needed to be fixed about the property, further substantiating his claims. 

I do not believe agents should spend their time negotiating short sales.  Instead, agents should spend their time doing what they do best:  listing properties and marketing them to potential buyers.   The most successful real estate agents in the country doing high volumes of short sales are not actually negotiating them at all. 

Agents should be experts at understanding real estate, not faxing hundreds of papers and knowing how to repair the fax machine when it eventually jams.  This is precisely why the agent is the perfect candidate for meeting the BPO.  For example, qualified short sale negotiators will almost always ensure that the BPO is met by SOMEBODY, whether it be the homeowner or the buyer.  They call these people the bank’s “ACCESS POINT.”  Yet is it not most fitting for the agent to be the access point, rather than the homeowner or the buyer?  For instance, an agent is neither the distressed homeowner (whom the bank is trying to foreclose) nor the investor (whom the bank is trying to negotiate with).  They are a 3rd party real estate expert and thus are in a perfect position to be meeting the BPO and assisting them in understanding the true market value of a given property.

HOLD ON, BECAUSE I HAVE YET TO TOUCH ON THE MOST IMPORTANT REASON WHY AGENTS NEED TO BE MEETING THE BPO.  

Ready?  The most important reason why agents need to be meeting the BPO is precisely because in order to save your homeowner from foreclosure, YOU NEED TO BE ABLE TO SELL THE PROPERTY.  Now if the bank genuinely believes your property is worth $400,000 (perhaps because you didn’t meet the BPO) when in actuality the property is worth $370,000, this will pose a problem not only for you as the listing agent, but for the negotiators, the buyers (who would NEVER IN THEIR RIGHT MIND buy a property above market value in this economy, I mean, how foolish do you need to be to OVER PAY on a SHORT SALE?! Think about it) and ultimately the homeowners who are desperately trying to walk away from this season in life. 

Remember what your broker used to say?  “Price it right or don’t even list it.”  The same principle applies here.  In order to maintain a high closing rate with short sales, you need to work with expert short sale negotiatiors who can negotiate a low price for the buyer.  Furthermore, you as an agent must meet the BPO in order to help these negotiations succeed.  Imagine the confidence you will have marketing the property at the “right price” (a deep, attractive discount).  The buyers get a great deal, you make your commissions & the homeowner completes the short sale.  When you do your part, EVERYBODY WINS! 

I help agents on all aspects of a short sale, from negotiations to the basic agency work (such as meeting the BPO).  We do this at no charge to the agent, in fact, agents are paid a 100% of their hard earned commission when working with our team.  So stop trying to negotiate all your short sales!  Never again do you need to stand next to your phone listening to automated messages all day or spend 4 hours trying to clear your paper jam.  Forget all that!  Just do what you do best and together we will close these deals and save thousands of homeowners from foreclosure.  Sound good? 

 Now let’s close these deals!