Short Sales for Buyers
There have been plenty written lately about short sales, and in particular, Realtors entering that market to help sellers who are handcuffed by financial binds.
Of course, the other side of the coin is the folks who are buying short sales. Is there opportunity for Realtors on the buying side? You bet.
Buyers need guidance just as sellers do. And actually, I believe they need more assistance than traditional buyers because of the complexities of short sales.
If you’re thinking of helping buyers with distressed properties, take a few minutes to consider these tips.
1. Know your stuff. Perhaps one of the reasons you have avoided helping sellers is all the education. Well, if you’re going to help buyers, you’ll need just as much (and some say more) than the agents on the selling side. “Make sure you educate yourself well, you need to know more than the listing agent,” says Tiffany B. Lachnidt, a certified distressed property expert I know who works in Colorado Springs, Colo. “In fact, you’ll need to interview the listing agent and make sure they know what they’re doing because your success is almost 100 percent dependent on their ability to do their job.”
So in essence, a good buyers’ agent makes a good sellers’ agent – you need to know both sides of what’s going on. To start your education, consider NAR’s “short sale and foreclosure resource” certification at www.realtorsfr.org. And two more options include www.distressedpropertyinstitute.com and www.fivestarinstitute.com.
2. Preach patience. Many buyers come into the market for short sales thinking not only that they’re going to get a good deal, but also that they’re going to score one quickly. Not so fast Mr. Buyer. Bank approval on offers sometimes takes weeks, so it’s imperative to first know how long buyers are willing to wait and then prepare them for the extra time it’ll take to close deals. “You need to educate your buyer well or you may end up with an unhappy customer if they aren't expecting some aspects of the process,” Lachnidt says.
“We explain that the process can be challenging, but we also talk about it being a great way to find a great home that’s typically the best priced home in the neighborhood.” Nevertheless, Lachnidt adds to set expectations appropriately. “Many times buyers have unrealistic expectations on what price the lender will accept.”
3. Keep emotions at bay. This is a good segue from number two about patience. Yes, short sales by their very nature are extraordinarily emotional for sellers, who are often in disbelief and denial. But beyond that, because short sales take so long, buyers (and even their agents) can end up emotional as well.
That’s why it’s important for agents to understand the process and to set expectations clearly and early. “It’s a mistake many agents make, becoming overly emotional about the process,” Lachnidt says.
4. Communicate constantly. Again, a nice transition from number three. One way to keep expectations on track throughout the process is to communicate constantly with everyone involved. Buyers’ agents have to stay in touch with bankers, asset managers, loss mitigation folks, but especially with the sellers’ agents – you have to work closely together relentlessly. And be sure to share all the information you get from the sellers’ agents with your buyers – keep communications wide open.
If you are considering short sales, I have a free buyer interview form that shares questions you can ask a buyer who's considering a short sale purchase. Simply email me at Bob@CorcoranCoaching.com, and I'll be happy to send it to you.
Let me hear from you. What's the short sales market like where you are? Are you representing buyers? If so, how’s it going? Who's buying, mostly investors or the general public? Please share any comments or questions you have about this article. Send me an e-mail at . Bob@CorcoranCoaching.com
Bob Corcoran is a nationally recognized speaker and author who is founder and president of Corcoran Consulting Inc. (CorcoranCoaching.com, 800-957-8353), an international consulting and coaching company that specializes in performance coaching and the implementation of sound business systems into the residential or commercial broker or agent’s existing practice.
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