Is there really such thing as a short sale?

November 7, 2008

I have been writing an on-going series of stories about Phoenix AZ short sales and Scottsdale AZ short sales and the challenges and short sale nightmares buyers and sellers are facing with getting a short sale transaction closed.

The question I ask “Is there such thing as a short sale?”  Is there such thing as a short sale in phoenix az ?

The problems with short sales are that most short sale are not short sales at all. Many real estate agents, just take a listing, and market and advertise the home at a price that would net the seller less than the amount owed. Then, when an offer is received the listing broker submits that offer to the bank.

There is very little incentive for banks to accept a short sale.

  • The bank often collects insurance if the home actually is foreclosed upon.
  • The loss of principal, penalties, fees and interest are also deductible to the bank.
  • A loan modification package is a better option for the bank and the exact same financial information.
  • loan modifications allows the bank to continue to collect interest and prevent taking the home into inventory.
  • Bank are waiting to see if the FED will bailout the bad loans.
  • A seller sees little benefit to a short sale. 99% of the time the credit is already affected negatively.
  • A buyer has options at better prices to make offers such as the large amount of lender owned properties (REO)
  • A buyer can stay in the home mortgage free until the home is foreclosed upon versus a short sale where (in most cases) they need to keep the home current.

I have heard statistics suggesting that 90%+ of all short sales never successfully close escrow. If that is even remotely accurate, I would argue that, for all intent and purpose, there is no such thing as a short sale.

If you are considering a short sale, make sure you work with a Phoenix Realtor or Scottsdale Real Estate agent who is experienced with short sales and bank owned transactions.

If you are a buyer, make sure you contact a real estate broker who is knowledgeable with Phoenix AZ reo’s and Gilbert AZ lender owned real estate.

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Copyright © James Wexler *Is there such thing as a short sale?*

If you are listing your home as a short sale in Phoenix Arizona or Scottsdale Arizona make sure you hire an agent who knows how to do short sales and has the experience to get the job done.

Call 480.221.8080 to find out more about Phoenix AZ Short Sales and Scottsdale AZ short  Sales

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Written by James Wexler · Filed Under Articles, Short-sales / Foreclosures 

Comments

2 Responses to “Is there really such thing as a short sale?”

  1. Susan on November 8th, 2008 10:31 am

    Wow, that’s high!! 90%!

  2. Neal Cross on November 12th, 2008 6:24 pm

    7m4lj0e3gsrcev67

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