Apr. 9, 2007 - Short Sales in Columbus
 I have a link to Inman News in my 'Real Estate is Local' category on this blog. Inman is news about real estate, news for people in the industry and for the public nationally.
Inman News has some great national real estate columnists, Diane Hymer, Bob Bruss, Illyce Glink covering various topics some real estate industry focused, some consumer focused... finance, inspection, investment, marketing, technology....everything on Inman New is all real estate all the time though.
Sign of the times today two of the headlines that caught my eye on Inman News are on short-sales, or work out programs,<-- link a term I had never heard until about a month ago. I went to a class on short sales given by a mortgage broker who serves Central Ohio recently. I had hoped it would deal with short sales from the buyers point of view. Instead it was about listing short sales. Not "corner the market and become an expert on short sales kind of presentation but more what to do when you list a home owner's property that may be a candidate for a short sale.
I am not going to mention names but some of us took from the class this advice "Run! Run!"
Inman News Columnist Dian Hymers article today on short-sales has tips for buyers!
"sale property comes with risk
In this deal, ball is in lender's court
HOUSE HUNTING TIP: Beware of sellers in short-sale situations who list their properties at below-market prices in order to entice buyers into making offers. Before getting serious, find out the amount of the loans that must be paid off to close the sale. If the loan amounts total more than the sellers' asking price, then you will either need to pay more, or the seller's lenders will need to agree to accept less than they're owed. That is, unless the sellers have savings to contribute to the sale.
Buyers who want to go ahead with a purchase that is subject to the lender's approval should be prepared for a longer-than-typical closing. Usually, the lender won't even take a short sale under consideration until the sellers have accepted an offer. It can then take three or four months before you'll know whether or not the lender will approve the sale.
THE CLOSING: Be sure to include a provision in the contract that allows you to withdraw at any time up until the lender approves the sale. This way you can get out of the contract without penalty if it looks like the transaction has little chance of closing. "
In my experience the thing that buyers don't want to believe is "It can then take three or four months before you'll know whether or not the lender will approve the sale."
As a real estate agent I can search for "short-sales" in the multiple listing service. The first one I ever sold did not have the words short-sale in the comments. There was a hint though... a line in the remarks about the lender needing to approve the sale... a year or two later when people started talking about short-sales, I knew I had done one.
Another Inman News article today by Matt Carter, part of a series has news of the sub prime market that caught my eye. That lenders (sub prime) are starting to recognize that they need to work with homeowners on short sales and that buyers get fed up and move onto other properties because of the three or four months it takes to get lender approval. The math for foreclosures made for very gloomy reading in Carter's article BUT a couple of rays of hope for consumers, buyers and sellers both in "Workouts could soften impact of sub prime lending woes Part 1: The new housing vernacular"
The article posted Monday, April 09, 2007. The bad thing about Inman is unless you subscribe ($) the articles are not readable the next day... so no links to Inman articles
The article uses the workd workout which I had never heard used locally about short-sales. What Matt Carter wrote ... the good news. Kinda:
Sean Purcell, the founder of CQ Financial Group in San Diego, said most subprime lenders "have come around" to the idea of the short sale.
"On some, you even have the lenders out front, saying here's what we'll take," Purcell said. "You never saw that two months ago."
In March I posted some statistics about the 2006-2007 Central Ohio short sale market...
Copyright 2007 Discover Columbus and Maureen McCabe
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