Grand Rapids, MI 2009...

Homeowners in Grand Rapids, MI have witnessed a startling increase in the rates of homes sold through foreclosure sales and short sales.  In the early portion of 2007, the percentage of home sales that were 'crisis sales' hovered between 14% - 16%. 

But by the end of 2008 and into early 2009 the numbers had escalated dramatically to account for over 70% of the homes sold by the members of the Grand Rapids Association of Realtors Board.

Selling a home within this type of environment requires a different approach. 

Although marketing a home has never been easy, the challenges of the current crisis require a firm resolve and focus to do whatever it takes to succeed. 

The Truth about this Market...

A very different mind set is required...that is IF you intend to sell your home within the next 12 months.  Now, one important note:  this market is not for everyone.  If you have recently purchased a home or don't have a compelling need to move such as a change in life circumstances or employment, this may NOT be your market.

However, there are some things which you can do to enable a more efficient process if you have to sell your home for less than what you owe on the mortgage aka as a Short Sale.  Here they are:

Document your financial hardship...

You will be required to give a fairly detailed accounting of your financial condition which will include statements from all bank accounts, investment accounts, tax records, a credit report, and a letter documenting your situation.  Be prepared to submit this documentation in an organized fashion and include a letter/statement which authorizes the bank to speak to the appropriate professionals such as your real estate broker if your home is listed.

Set the Stage...

Just because your home is being sold under less than ideal circumstances does not mean that it should be portrayed this way in your marketing efforts.  The goal of a short sale should be to sell your home.  Remember that your home will be competing with potentially hundreds or thousands of homes. 

Unless a home buyer falls in love with your home, you won't even have the chance of negotiating a short sale. You may also inadvertently attract even lower offers from buyers who smell desperation within the mess.  It should also be noted that home buyers are often wary of the long drawn out process that the negotiation of a short sale requires so make it worth their while to wait!

Price to Compete!

One of the most interesting points during my listing presentation is when I show home owners a map of just how many homes are listed or have sold within their community within the past year.  Most people are more than a little surprised.

There's a lot of activity happening in the real estate market right now and you owe it to yourself to have an accurate understanding of your neighborhood market.  Run the other way if an agent shows up at your door to take your listing in hand without documenting in detail WHY and HOW he/she has arrived at a pricing strategy and listing price.

Detach the Sentiment...

Proper pricing and subsequent adjustments are critical if you are to succeed.  A market rife with foreclosures sometimes makes for a 'moving target' when it comes to determining the right price.  Be prepared to make adjustments quickly to reflect market realities which will include banks unloading more of their extensive foreclosure inventory in 2009.  Emotional attachment about why this 'awful situation' should not apply to your particular home will not serve you well when you're dealing with buyers who are primarily looking at the bottom line. 

On the other hand...a good deal cannot be hidden!  We're seeing homes priced competitively getting several bids and sometimes selling above the listing price.  These homeowners took the time to understand their market and to respond accordingly.  My counsel if you're determined to Sell Your Home...is to take note.

Click here for Related Short Sale Articles:

Copyright 2009  Audu Real Estate  All Rights Reserved

In a real estate market in which just under 1 out of 2 homes which are actually SOLD are Short Sales or Foreclosures, more home sellers in the Grand Rapids, Michigan area are inquiring about if a Short Sale may be a viable path to consider.

It is no secret that there has been a precipitous slide in home prices over the past year.  This coupled with the sub-prime mortgage mess has placed some home owners into a situation in which the Value of their home is LESS than what they currently owe  on their mortgage payment.  In some cases...way less.  As a result, some home owners are bringing thousands of dollars to the closing table to make up the difference owed to the bank.

But what can you do if you don't have Thousands of Extra Dollars sitting in a bank, savings or retirement account?  Unfortunately, this is a question, many home owners are asking.  Individuals who have to move due to a job loss, illness or divorce.  Individuals who can no longer afford to stay in the home they bought.

Short Sales are complex real estate transactions.  Although banks do not want to 'own' real estate, they are often less than cooperative in situations in which the debt obligation to them will not be fulfilled.  To make the case to the bank about the specifics of your situation and your intention to try to fulfill your obligations to the best of your ability, it is wise to hire a real estate agent who has successfully completed Short Sale negotiations and who understands the intricacies of the process.

There are several stages within a Short Sale Negotiation.  The first determination is to gain a comprehensive understanding of your specific situation.  Questions which need to be answered include your payment history and a complete analysis of your financial resources; including a detailed rendering of any extenuating circumstances which may impact your ability to repay your obligation.

The home in question must also be verified through a market analysis to substantiate the loss in Value.  This will often include not just a real estate broker evaluation but also an independent appraisal or Broker Price Analysis from another source.  Then the home must be marketed aggressively, as NOTHING proceeds forward until you obtain a viable buyer.

Once an offer is tendered, the real 'fun' begins.  In some instances, we have encountered Loss Mitigation Specialists assigned to handle up to several hundred files at a time.  The pressure on them is enormous and they often fail to answer their phones or respond to any attempts of communication.  It is here that hiring the RIGHT agent makes all the difference in the world. 

It is important that your real estate agent/broker possess the following qualities when negotiating a Short Sale.

1.  They must UNDERSTAND the process...knowledge of the different aspects of foreclosure & short sale

2.  They must KNOW how to price your home to actually SELL

3.  They should have a good INTERNET presence to attract the largest pool of buyers

4.  They must be PERSISTENT in their negotiation efforts

5.  They should have an inherent grasp of the DETAILS to ensure that all parties remain informed

6.  Your agent must be DETERMINED to represent your best interest

Successful Negotiation of Short Sales is a mandatory element of the training which the agents of Audu Real Estate receive during their 1-2 year apprenticeship.  Audu Real Estate has successfully short sales on behalf of our clients. 

We strive to conduct our negotiations in a way which honors the dignity of those involved and protects their privacy.  If you'd like additional information or a private consultation regarding your Short Sale options, please contact us at: info@audurealestate.com.

Related Links:

Additional Real Estate Short Sale Articles by Audu Real Estate