Counseling Buyers about Short Sales

Buyers are often drawn to short sale listings because of aggressive pricing, but the short sale process can be mind-numbing for the unprepared, the unwilling, or the uninformed.

You might choose to avoid listing short sale properties, but it is unlikely that you can avoid buyers who want to buy one. Below are some points to discuss with those buyers before entering the short sale environment:

1. Do you have the patience to wait for 30-90 days before finding out whether your offer is accepted by the lender?
   
   
2. Is it OK with you that the seller takes no responsibility for the condition of the property and its components?
   
   
3. Do you have money in reserve to make the house habitable, to make necessary repairs, or to comply with lender and municipal inspection work orders?
   
   
4. Do you have the flexibility of an alternative place to live in the uncertain time period before closing and possession?
   
   
5. Can you afford, psychologically and financially, to start all over again if the lender says no?
   
   
6. Can you accept last minute surprises, changes, and expenses?
   

Not every buyer can handle those harsh realities. And they must also understand that they will be dealing with a relatively indifferent seller with no equity in the transaction, and a lender who’s losing money. However, the short sale can provide your buyer with a real value, and you can earn a commission that you wouldn’t have otherwise. You’ll both need patience, and knowledge of the process.

The preceding was an excerpt from our online course, The Short Sale Investigative Report.