Here is the NWMLS definition of a short sale:

“A “Short Sale” is a sale that does not produce sufficient funds to cover the . . . → Read More: Short Sale News! New for April 2008:NWMLS Changes The Rules]]> Short sales are popping up more and more across the Seattle area. Buyers need to be aware of whether not a potential property is a short sale because the offer process is quite different.

Here is the NWMLS definition of a short sale:

“A “Short Sale” is a sale that does not produce sufficient funds to cover the existing monetary encumbrances against the Property, closing costs, real estate commissions, and other financial requirements of closing. Seller’s creditor(s) are those third parties who have an interest in the Property in the form of a deed of trust, some other security, or a lien (e.g. tax lien).”

See my problem with a short sale listing is that buyers go into the process without the full knowledge of how different it is from a “normal” transaction. The NWMLS has come up with a form to help, but making sure to use a short sale agent in the process is the best plan of attack. Short sales can be great deals, but knowing what is involved is key.

Knowing that a listing is a short sale is also key since there are no guarantees as to price or commission in a short sale. The offer is (or should be) always signed subject to lien holder approval. The lien holder almost always inevitably comes back with a higher price even if you offer the list price and they also usually come back with a lower commission amount for the two agents involved. False advertising all around in my opinion. The MLS is now stating that a short sale listing must be disclosed. This is a step in the right direction in my opinion.

Another really needed change: Short sale properties typically stay marked as “active” in the MLS while the approval from the lien holder is being obtained. This is frustrating for buyers out there and also bad for the MLS stats. I think the short sale numbers are actually seriously dragging down the area stats overall and the new rule is a helpful one in that. The properties with offers which are waiting for approval will be marked “pending – BU” until they go to “pending” and then “sold”. I am extremely pleased with this development which will be good for everybody. Other sellers in the neighborhood who may be waiting for a distressed property to come off the market before they put theirs on can now have an easier time without false lower priced competition.

Introducing Form 22SS:

The MLS’s short sale addendum for Washington state (Hallelujah!). It isn’t perfect, but it is going to help clarify a lot of the process and steps that have been unclear in the past. First of all the from states that the property is a short sale and that the lien holder has to approve the offer. The form then gives the seller so many days (default is 30 days) to get that approval. Mutual acceptance is explained as when the lien holder approval is delivered. 22SS Gives the buyer the option of checking a box to either say that the seller can accept other offers for lien holder approval while they wait for their answer or not. My advise on that to buyers is check the box that allows your deal to be the only deal in town. Of course, my advise for a seller is usually the opposite depending on the situation. Lastly, the new from gives the buyer the right to back out of the deal at any time prior to lien holder approval.

Instead, the 2008 market is very different, and those who are used to the easy flow of the past few years need to step up to a different ball field. This includes all parties to the transaction!

Buyers need . . . → Read More: Seattle real estate: 2008 Market Conditions in a Nut Shell..]]> Seattle real estate has softened, but we certainly are not “in the tank” as I read another broker put it.

Instead, the 2008 market is very different, and those who are used to the easy flow of the past few years need to step up to a different ball field. This includes all parties to the transaction!

Buyers
need to understand that there are some incredible deals out there right now! Prices are generally very good as sellers try to compete with short sales and foreclosures that are sneaking on to the market. Seattle buyers have been complaining about a seller’s market for years and now find themselves in a buyer’s market finally! Even with this combined with the lower interest rates, there is still some reluctance to pull the trigger! I personally think there could be a few reasons for this hesitation which include uncertainty based on our political climate, uncertainty in the economy, and also a general lack of confidence in the strength of the housing market. Well, I have no idea who will end up in office, but I can tell you that our Puget Sound Economy is generally very good and jobs were up the last time I checked. People are also still buying and selling real estate even if prices have come down in some areas. Seattle is still one of the most undervalued West Coast cities and we are a major metro. If you are on the fence, get off.

Sellers
– Price your home reasonably and please be open to a negotiation. It isn’t personal –it’s just business. The buyers in 2008 like your house a lot, but they have a lot to choose from and they want to negotiate. De-clutter it, have it professionally Staged by an accredited Stager, and make it easy to show. Don’t skimp on commissions either – this is not the time to be choosing any other REALTOR except for a FULL service REALTOR – oh and make sure they in fact are an actual REALTOR. Did you know that not all real estate agents and brokers are REALTORS? The term is REALTOR, not realtor – it is a proper noun – and REALTORS actually abide by a higher standard of practice including a code of ethics. You need someone with a high level of expertise in marketing your home. This is also not the time to try a FSBO – stick with a market expert to guide you through 2008!

Agents & Brokers:
Be free with your information – that is what 2008 and beyond is about. There is value in sharing information rather than guarding it. In the past, we have tended to keep our knowledge close to the vest and in this changing market the consumer is looking for answers well before they make a purchasing decision. Open, honest, and down to earth advice and guidance is a must for a new market.

Courtney Cooper ….For all your Seattle Washington Real Estate Needs! Seattle Area Real Estate Agent: Broker and Realtor serving North King & South Snohomish County.  Seattle Real Estate and Seattle Suburbs!  Cooper Jacobs Real Estate Services:   Experienced REALTOR with a background in accounting – I love my clients and work hard for them! Please call me if you are looking for a home or investment property (including short sales, preforeclosures, foreclosures, and REO properties) in Seattle (Ballard, Crown Hill, Phinney, Ravenna, Maple Leaf, Green Lake (Greenlake), Greenwood, Northgate, Lake City,University, Sand Point, Laurelhurst, Windermere, Fremont, Wallingford, Queen Anne, Westlake, Eastlake, Lake Union, Downtown, Madison Park), Shoreline, Edmonds, Brier, Lynnwood, Mountlake Terrace, Lake Forest Park, Bothell, Mill Creek, Everett, or other Seattle Suburbs!

 If you are thinking of relocating to Seattle, I am an expert at Seattle Relocation services and can help you find the perfect home while making sure it is a solid financial investment! 

Seattle buyers: You might consider a short sale, but be prepared to wait and wait and wait. Not only will you not get an answer immediately when you put in an offer for a . . . → Read More: Seattle Real Estate: Short Sales In Seattle &The Seattle Suburbs…]]> Seattle real estate is in a buyer’s market, but are you looking for a way to get into a Seattle house even cheaper?

Seattle buyers: You might consider a short sale, but be prepared to wait and wait and wait. Not only will you not get an answer immediately when you put in an offer for a short sale, you will more than likely have to wait for weeks and weeks.  The bank is in no hurry to sell you this house for $50,000 or more under market, and they also like to drag their feet to wait for a better offer.  If you want the deal, you have to be very patient and understand what you are getting in to.

What is a short sale?

Simple Short Sale Definition:  A Short sale is when the seller owes more than the house can be sold for in the current market, so the bank has to agree to write off the difference and sell the house for less than they are owed.. Coming up with an acceptable price for the bank when they are losing money on a loan can be tricky and requires someone who is willing to go to bat for both parties – the buyer who wants to get a good deal and the seller who wants to get out of a loan without a foreclosure on their record. It is also in the bank’s best interest because they want to save on the time and money it would talk to foreclose on a property that is in arrears.

The problem? 

 There are no guarantees that just because a house is listed for a certain price that it will sell for that price or even close to it.  The listing agents list these short sale homes as “subject to lien holder approval” in the agent only remarks.  I strongly think that this lingo should also be put in the public comments so that a prospective buyer is well aware that the price is not a definite and that even the sale is not a definite until a lien holder approves of it. In fact, in most cases if you put in a full price offer, the bank will likely counter back at a higher price than the property is listed at! Doesn’t seem fair does it? There is a difference between an approved short sale and a short sale. With an approved at least there is some guarantee of price range, but the fact of the matter is that most short sales listed are not approved short sales. It is just too difficult to get a bank to pin down a number without an offer in front of them!

Good news!

The good news is that a Seattle short sale can work out for all parties involved and benefit all! Make sure you are working with someone that knows how to do a short sale! Search for Seattle Short Sales.

Courtney Cooper ….For all your Seattle Washington Real Estate Needs! Seattle Area Real Estate Agent: Broker and Realtor serving North King & South Snohomish County.  Seattle Real Estate and Seattle Suburbs!  Cooper Jacobs Real Estate Services:   Experienced REALTOR with a background in accounting – I love my clients and work hard for them! Please call me if you are looking for a home or investment property realestate (including short sales, preforeclosures, foreclosures, and REO properties) in Seattle (Ballard, Crown Hill, Phinney, Ravenna, Maple Leaf, Green Lake (Greenlake), Greenwood, Northgate, Lake City,University, Sand Point, Laurelhurst, Windermere, Fremont, Wallingford, Queen Anne, Westlake, Eastlake, Lake Union, Downtown, Madison Park) & other Seatle neighborhoods, Shoreline, Edmonds, Brier, Lynnwood, Mountlake Terrace, Lake Forest Park, Bothell, Mill Creek, Everett, or other Seattle Suburbs!