Some Pitfalls of a SHORT SALE

(article being re-run - September 30, 2011)

On Thursday, March 10, 2011 C.A.R. (the California Association of REALTORS(R) is running an open letter in several newspapers statewide, addressing the numerous challenges associated with short sales.

The open letter addresses the following topics: The benefits of doing a short sale rather than a foreclosure; the inconsistencies with short sale processes at banks; the challenges of working with multiple lien holders; and the slow and/or nonexistent communication by banks and servicers to REALTORS®, homeowners, and buyers.

The letter closes by calling on regulators, elected officials, nonprofits, business organizations, companies, and individuals with a stake in California’s economic future to resolve the short sale issue and other issues that get in the way of an economic and housing recovery.

The letter will be published in the Bakersfield Californian, Fresno Bee, Los Angeles Times, Mercury News, Sacramento Bee, San Diego Union-Tribune, and San Francisco Chronicle.

Below is an excerpt from the letter which is to appear in the papers mentioned above:

Unfortunately, many homeowners are unable to successfully negotiate a short sale.  According to a recent survey of 2,150 California REALTORS® who have assisted clients with a short sale, only three out of five transactions closed – even when there was an interested and qualified buyer.  

What’s the problem?  For one, no two mortgage agreements are the same, so it can be difficult to standardize short sale processes and procedures.  Many homeowners have second mortgages, which further complicate matters.  Then there’s the challenge of convincing multiple parties to take a financial loss or, in the case of loan servicers, to forego fees they otherwise might earn during the course of the foreclosure process.  Poor and slow service by many banks and servicers has only exacerbated the problem.  Horror stories abound from potential homebuyers and REALTORS® forced to wait 90 or more days for a response to a purchase offer or being required to fax short sale applications or other paperwork as many as 50 times.   These delays discourage potential homebuyers from considering a short sale purchase and undermine the process for those who short sales are intended to benefit – the hundreds of thousands of families facing foreclosure. 

The entire letter from the President of the California Association of REALTORS(R) can be read on March 10th in the Newspapers mentioned.

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If you are interested in purchasing or selling real estate in the Santa Clarita Valley, feel free to contact me for an interview:
LeeAnn Bell, 661-309-2364

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LeeAnn Bell, REALTOR(R)
DRE License # 01260650