Stop Foreclosure -Why Some Relators Can Ruin Your Short Sale

You have done every thing possible to save your foreclosing home, but failed to do so. Now, your only hope is to stop foreclosure so you don't have to stain or ruin your credit completely. So you decide to do a short sale to stop the foreclosure. You sign an agreement with a real estate agent and also agree to let the real estate agent to help you to do a short sale. Will this real estate agent help you or hurt your short sale.

My answer to you is that most likely, the real estate agent will ruin your short sale and your goal to stop the foreclosure will not be reached.

I am licensed real estate agent and also a real estate investor who has been buying properties through short sales. My experience tells me that majority of real estate agent will ruin your short sale rather than help you. Here are the reasons why some real estate agents will ruin your short sale.

1. Most real estate agents don't have the education on how to do a short sale. This is an iron hard fact. They don't know how to help you.

2. Real estate agents including me are in the business for commissions. It is an industrial norm that real estate agents are looking for 3% commission of the sale price whether acting as listing agent or selling agent. There is not much incentive for some of them to work hard to get big cut of the commissions.

3. In most short sale, there is not enough equity left to pay 3% commissions for the listing agent and another 3% for the selling agent.

4. Lender's goal in a short sale is to minimize the loss or to get as much money back as possible. With a real estate agent commission, lender's net sale price will be much lower. If the lender believes that they can get more money back by foreclosing than accepting the short sale. Lenders will choose to foreclosure your home.

5. Short sale buyer's goal is to buy the property at lowest price possible. With real estate agent commissions, buyer has to pay more in order to get the lender to approve for the short sale.

Therefore, it is not in the best interest for both lenders and short sale buyers to have real estate agents involvement.

6. Worse of all, some real estate agents are very inflexible on their commissions. They are unwilling to yield their commissions even they know if the property goes to foreclosure, there is zero commission.  Those were worse agents I encountered in the last few months. As a real estate agent, I fully understand we need commissions to support our family. But, short sale is totally different from regular real estate deals. If you want list a property for someone for a short sale, you should have to heart to help the people in trouble to stop the foreclosure and should be willing to accept less commission in order for the short sale to work out. If you don't like the small commission, then don't sign an agreement with the short sale seller.

To those homeowners who want to do a short sale to stop foreclosure, my suggestions to you are:

1. Work only with the real estate agents who have done some short sales and also willing to accept 1% or less commission;

2. Work with short sale services companies who can find many investors for you. There are companies doing short sales for homeowners and buyers. Those who work for the buyers make money by charging the buyers for the service fees and also get paid by the lenders if the short sales are approved. They are usually big guys.  Those who work for home sellers are the small guys and they get paid by the lenders if the short sale is approved by the lenders. You should choose those little guys.

3. There is also a website offering free short sale listing for you to access the serious buyers or investors. It cuts the middleman to increase your possibility for the successful short sale so you can stop the foreclosure. If you list your home there for a short sale, they will also help you to do short sale for free. It makes money by successfully helping you get the short sale done and by helping buyers to find you. Go to this site and check it out: http://short-sale-listing.com .

My next blog will be: How to find  short sale buyers to stop your home foreclosure.

For more information on home foreclosures, go to http://foreclosure-help-centers.com

For more help, post your questions at http://forum.foreclosure-help-centers.com

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