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Short sales, (sales of homes for less than the amount of their outstanding mortgage debt) have tripled since 2008, particularly in California, according to a recent article in the Los Angeles Times.
The number of transactions rose to more than 160,000 in 2009 from roughly 96,000 in 2008, with more than a quarter of the transactions occurring in California. The increasingly common transactions are projected to rise to 400,000 in 2010, and such sales will likely remain routine as the mortgage industry attempts to stabilize. As I have stressed before, real estate is very local, so not all markets are effected the same.
Last week I participated in an Alain Pinel Realtors seminar to become certified as a Distressed Property Educated Buyers Agent “ this allows me to represent buyers in purchasing a short sale property, but I have chosen not to represent sellers of such properties as part of my real estate practice. If you know a seller with this need I can refer you to someone in our company who is Certified in this aspect.
Among the things that were discussed by APR Trainer Jim Pojda for selling agents were:
Real estate agents are licensed under California law in very narrow areas and they are not lawyers nor are they foreclosure advisers. We may have general knowledge of changes in the law or banking policies affect these transactions, forgiveness of debt, tax law, credit, rehabilitation, or mortgage relief, but it is standard practice to recommend in writing to our clients that they seek out and obtain the advice of competent lawyers, accountants or other licensed professionals with respect to the individual issues which may impact them.
Last summer, 2009 when I took the California Association of Realtors Distressed Properties Training I noted that a local agent active in short sales said that “probably only 10% of short sales actually close escrow!” Last Friday I asked Jim Podja whether the percentage has improved since 2009 and he said “it has because both banks and real estate agent are now more experienced in the short sale process, but he did not have an updated percentage estimate. There is still a wide variance in practices among various banks/investors and agents.
Alain Pinel is a leader in training its agents about the nuances of distressed property sales; unfortunately, there are still too many licensed agents working for smaller brokerages who do not have either training or experience. Call me if you need help with your real estate transaction.