You may already know that short sales can be a long and involved process, and frustrating for everyone involved.  The secret to eliminate many common headaches is getting the property ‘pre-approved’ for a short sale offer, while gently guiding the sellers in order to avoid potential disasters.

Would you like a quick reference for exactly what you need to get short sales pre-approved in record time?  Agent Terrence Hassett explains how to do just that in three simple steps.

Here’s Terrence’s description in his own words:

“Co-op brokers are wary of short sale offerings, due to the risk of last minute fall-out or problems over commissions.  By counseling your sellers to submit EARLY, you can usually get a ‘pre-approved’ short sale offering, and head off some of these problems.  Here’s the best way to approach this…

A. Start by obtaining the submission package from the lender or have your own, including:

B. Counsel your sellers as to the potential problem spots up front, like:

C. Let sellers know that the lender will likely ask for:

If you can get your short sale pre-approved, you can offer the listing with a higher probability of closing.  And these three steps will put you well on your way to a complete package for an offer submission.”

Do you remember the value of educating clients from this article? An educated client is worth 8 to 10 times more than an UN-educated client.

Today, many buyers are considering buying short sale properties but they are “UN-educated” and often UN-realistic about the time frame and details involved.

Agent Nancy Biel Stewart uses a unique tool to educate buyers of short sale properties. Using a simple “short sale booklet” she gives her buyers an overview of the process and sets their expectations up front. This helps her diffuse their frustrations with the process AND is a powerful way to communicate her knowledge and value to clients.

Here’s Nancy’s description (and sample below)…

“Selling real estate today can be challenging in many ways. Many of our listings are in short sale situations. I represent buyers most of the time, so I have taken several classes on short sales to better help them. I use the handouts from these classes, combined information from my experiences and created booklets to give my clients who are considering the purchase of a short sale property.

One key to selling these homes is managing your client’s expectations. I let them know up front that they may not get an answer from the banks on their offer for months and that other buyers may submit competing offers even after the seller has signed the initial offer.

My booklet explains the process from both the seller and buyer side so my clients know what they are getting into! If they proceed and become discouraged or anxious, I just refer them back to the book and calm their anxiety. Most read the booklet thoroughly and have a better understanding that all parties involved are under much stress and patience is the key to a successful closing.”

You can click on the image to see a sample booklet as a pdf:

“I had a transaction a couple months ago with a first time home buyer. We originally went in $15,000 less than the asking price and they countered back at the full plus $2,000 more because we were asking for 100% financing and seller credits. We countered back and they accepted.

Upon doing the walk through my client found out from the home inspector that the roof was going to last a couple years (his opinion) which I told the inspector he should not give his opinion since he is not an expert in that area. My client was stuck on how long the roof was going to last. On that same day of the inspection, one of the sellers came home and told my client that they would paint the house. This of course made my client happy.

Surprised by the offer to paint, I inquired with the other agent who said, ‘NO WAY.’ She then asked the sellers and they denied saying they would paint. Eventually we got them to paint but they said they would only touch up the inside only. Furious my client wanted to cancel.

We somehow got a price reduction for the roof since the sellers wanted to appease my client. We also got the sellers to paint the inside, which my client wasn’t too happy since he said ‘paint’ means the whole house inside and out. To add icing to the cake, this turned out to be a short sale with the bank dodging our calls.

It did not end there, the sellers couldn’t find a place to stay and wanted to rent back the house for 2 weeks. My client agreed only through out the weekend. It turns out they didn’t leave till Tuesday which my client was about to call the police for trespassing. They finally got out but left all their big old furniture out in the curb for the city to pick up which wouldn’t be for 3 weeks. A huge pile sitting near the driveway (an eyesore).

I was not only a Realtor, but a Counselor trying to calm my client down with his emotions after one thing and another. I spent every night trying to talk my client into NOT canceling but to try to work it out. From the roof it took me practically every day to keep the deal together. This experience was a roller coaster for my client AND for me as the agent.”

Everyone is hearing about “short sales” today but most don’t understand all the details involved. Here’s a simple yet effective way to grab people’s attention and maximize your marketing efforts.

With listings, agent Bob Collard puts up the typical for sale yard sign and then puts a separate sign that attracts attention… a sign that says “SHORT SALE” in easy-to-read letters (you can see the picture below). This helps motivate calls on your main sign.

When I followed up with Bob about this idea he said that very day he was helping a cash buyer look for a similar deal who first contacted him by seeing this Short Sale display. He informed the person that the property was sold in less then two weeks since he put out the sign.

He said his signs are eight inches high and twenty-four inches long on white corrugated plastic (they easily fit wire frames that way). And he uses 4″ red letters with all caps.

What if you don’t have a short sale listing? Use this idea with other words that catch attention such as one with owner financing as Bob describes below.

Here’s Bob’s description and the exact sign he uses…

“I am a simple guy and I like to use simple tools. We all know that signs work, but do we take full advantage of them? I started using “SHORT SALE” signs on a separate pole. My phone started to ring again even in this slow market. Some callers just want to know what a Short Sale is.

I had two offers in two weeks and one is on way to closing. Another sign I use is “OWNER FINAN, WITH 5 K DWN” on two lines. Same results on my phone. Offers coming in this very day. I don’t use overworked signs like, “Motivated” or “Reduced” as they are everywhere in my area.”