So just a spin off from the great healthy debate "Are Attorney's Ruining Homeowners" I wanted to pose another topic and get opinions. The question that pops up everytime...."Will this cost me anything" or "I don't have to pay anything for this right?"
We all have been there, lender won't budge, buyer won't contribute anymore and now there's a gap between what you have and what's needed. The homeowner either legitimately CAN'T or WON'T contribute. However soooo many of the same homeowners willfully hand over $1500, $3000, or sometimes much more to an attorney for workout options.
With that being said can I, once again, reflect this back to us and ask is it our fault (To a degree) because WE havent properly discussed the difficult scenarios that may play out once we begin this short sale process and gotten everything out upfront at the listing appointment?
Do we just jump because it's a new listing rather than really screening, educating and preparing everyone for what may come?
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Eric, I tell every seller up front that the lender can and will ask for a cash contribution. I put worst case scenarios in front of them to see how they react. In a listing appointment you MUST always look for a reason to stop the appointment and walk away. If they are truly BROKE, I tell them that we will just have to plead our case if they ask for a contribution and 99% of the time we come out a winner.
We MUST discuss all possibilities and be ready to walk away when the red flags begin to fly
Since the Seller can no longer contribute in my Short Sales, I REALLY have to lay things out for BOTH Sellers and Buyers here in California. Also..with the new law disallowing pursuit on 2nds, I have to try to be ahead of the Lenders in trying to figure out if the 2nd will even allow the Short Sale based on that law.
So far, it appears to be helping my Sellers, although I am told by other Short Sale Agents that they've had some turned down completely because they will not release their right to pursue deficiencies on the 2nd, which they can after a Foreclosure in many cases. Examining that 2nd is even more critical for me now.
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