Fannie Mae and Freddie Mac are now dictating market time. Short sales that are Fannie Mae or Freddie Mac loans must be active in the MLS for five days, including one weekend period, before an offer can be accepted by the seller.
Read the article. http://www.floridarealtors.org/NewsAndEvents/article.cfm?p=1&id...
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Hi Wendy, you know how I feel about this after our discussion over on your Google+ Short Sale Community. This attempt only tries to manipulate the market and doesn't let the market run efficiently on it's own.
Harry, I'm not sure what you mean by no regulation whatsoever. I agree with you that steering distressed properties to insiders who want to steal the properties is not a good thing and can be easily rejected when an appraisal comes back on the property.
And yes, others could be trying to manipulate the market too yet, two wrongs don't make it right.
Losses can be lessened by accepting fair market value for homes.
I think this is a wise move, but we already do it. When we get a short-sale listing, we do a "highest and best" period of 7-9 days and follow the bid deadlines strictly.
The only problem I see with this is the "Hail Mary" situations — when we get a file on a Friday or Saturday and have to have a complete SS package into the lender by Monday to stop a Tuesday foreclosure. We get one of those every month, on average.
I agree - why treat a short sale any different from a regular sale when it comes to marketing. I treat the short sale property the same as a regular sale - They get a nice sign up front, a website, Ad in the paper, featured on websites, broker's tour. and two Sunday open houses with a stated offer date. We get great offers and I have always picked up a client or two. Granted I don't do as many short sales as some of you - maybe just 6 a year but it has been good for business.
Let me see if I can follow the logic here. The banks insist that their BPO's or appraisals or FMV from some wacky database are rock solid and the buyer needs to bring up the offer, yet they are so clueless about the value of the property that they have to play time delay games to get the best offer. Right? Sounds like rules made by a political committee. So many of these machinations should be gone if the property value were accurate. Why should the investor care if it is getting the best offer on day one or from the seller's boss?
But, this rule is not as painful as FHA's "must list at appraised value" after it has been listed that way for 6 months with no offers. In a non-FHA real world, the agent would lower the price to attract a buyer.
The more buyers who see the property - i.e. the wider net you cast, should bring the highest offer. I live in an area where prices are fairly high and most every property has multiple offers. I too have been burned by the folks who do an in house/double end deal immediately as they are putting it on the market.d Just not right.
Give it two week and let the market dictate. To your point, if it sits there forever - 3 weeks or more - than drop the price. I have had Fannie Mae come back with a big price increase. However, in our market, it was still a good deal because it took 6 months for the approval. In that 6 months the prices skyrocketed so buyers put up the extra money but still got a deal.
Remember, a listing agents sole Fiduciary Duty is to place the seller in the best possible outcome. There is no duty to the sellers lender or market, or other agents. As an example, if I have a short sale listing and the seller will need additional cash funds to pay off a lien, and an in house agent happens to have a cash buyer willing to pay that lien and settle for my seller, then that is the best offer for my client, even if some guy off the street has a higher offer. The higher offer is beneficial to the lender, but in this case, not to the seller. because of these variables, I do not like these guidelines, but if they are in force, so what? It becomes like any other listing: Gather up the offers, then present them to the seller with your recommendations as to which is the strongest buyer overall. The seller then decides. Not the lender, not the MLS, the seller.
It's another political agenda disguised as Hey...we're your buddy...and we're here to help you.... yeah right!!!
Fannie is starting to want to get involved in agent's short sales as a concerned fatherly figure from the get go....
It's another attempt at Big Brother watching you every step of the way.... none of this benefits "the seller"
We as agents, know the rules when getting multiple offers and yes, presenting multiple offers to our sellers...and yes, as
Joseph Alfe points out...we hold a fiduciary responsibility to the Sellers, if we are the listing agents, not the lender...who as we all know...have THEIR agenda.
Harry, lets assume that I list a property for $200,000 and get an offer on day 2 at $190,000. I submit to Fannie Mae, they do their due diligence and get a value of $220,000 AND accept $190,000 for the short sale, that is their issue, not the sellers. Fannie has plenty of layers and safeguards, not to mention the most intelligent local real estate experts (even though their expert has never been to the location), so how could they sell a home for less and get scammed by that self serving real estate agent?
If Fannie is the victim, why are they not doing their due diligence when approving short sale offers?
They need to regulate themselves after the mess that they made in this country. Too many times we see Fannie foreclose on a property, spend thousands of dollars renovating and repairing only to sell if for thousands less or tens of thousands less. Fannie Mae is the largest homeowner/seller in my area.