Comment

Comment by Lynn Pineda on November 14, 2009 at 12:53pm

I've been contemplating this very issue lately as I'm currently working on about three Short Sales under $50,000 that are just about finalized for final approval and they have proven to be more work than the ones above $200K. I ask myself should I take these listings on but then I ask myself how can I say "no" to somebody who needs the help of a Short Sale specialist. Yes, I don't make as much as I would like but I don't have administrative overhead as I do it all myself. I have been considering getting a Short Sale processing team to work these lower valued homes and I simply list and sell it and not do the negotiations myself.

Anybody work any of their listings with a Short Sale processor?

Comment by Brian Brumpton on November 11, 2009 at 11:51am

Bryant,

I guess it goes back to what Wendy said initially, it depends on what your business model supports. Since I'm a with a brokerage where splits are involved, you can quickly find yourself on the losing end.

On a side note, I'm enjoying the interaction here. I know most of you from AR but it's gotten so big and some of the interaction isn't what it used to be. Thanks for setting this up.

Comment by Bryant Tutas on November 11, 2009 at 11:24am

Brian, I n my market the average sales price is about $75,ooo. It is very frustrating to work for months on a deal to make $2k. I have recently started expanding into other areas and I'm starting to get some listings in the high 2o0s. How low is too low? I don't know. I will usually help anyone in my market as long as they are nice.

Comment by Jeff Payne on November 11, 2009 at 9:52am

Brian, I would just tell them that no amount of advertising is going to help a short sale that is not priced right. Tell them that you have a specific plan and have to stick to it. If they insist, let them pay for the advertising :)

Comment by Brian Brumpton on November 11, 2009 at 5:09am

Katerina,

Sound advice, we started them higher than where they ended up but I quickly realized that the condition of the properties and attitudes of the tenants were going to be an issue. I'm of the same opinion, I like to help people but if I can't do it profitably, I won't be doing it for long.

I would have probably stuck it out had they not demanded that I pay for some advertising on listings I was going to lose money on.

Comment by Katerina Gasset on November 10, 2009 at 6:10pm

Brian- We don't take any short sale listings under 120K. We have some that started up in the 150K and are now down to 79K. Of course, we won't drop the listing because it is already worked on. But we also are working in the red when we take them below 12oK. We are in business for profits. I do enough pro bono work for my church and family and extended family. I have to evaluate every thing I do in life and in business against what is the highest and best use of my time. I have to pay all the bills, e and o insurance, etc. so we can not be working on files that are not going to bring in any money into the office.
We had one lady call us who bought 3 of those apartment/condo conversions that now is a drug infested condo with people peeing in the pool and no more money in the HOA to take of things because no one pays their HOA. She bought them for $395,000 each! They won't even sell for 35,000 each. Then there is no one to buy them, because the HOA fees are $400 a month. People can use $400 a month towards a house payment in a safe neighborhood without drugs and gangs. They were all with chase. We told her that we would refer her but we first would just make a call to the management at Chase about it. They said, tell her to walk! They won't even foreclose on those apts. They don't want them. Her only real solution is to file bankruptcy. No one wants that referral either.

Comment by Brian Brumpton on November 10, 2009 at 1:52pm

Wendy,

I would have probably stuck with it, but these properties were most likely going to end up under 30K.

Comment by Wendy Rulnick on November 10, 2009 at 1:41pm

Brian, I wrote a post about low short sale listings. If your business model can handle it, I would say, do some pro bono work to help the public. If your model cannot, then you should refer out!