I have been working short sale homes now for about 3 years, ranging in price ranges from 1 mil, down to 30k. During those 3 years, I've worked probably about 60-80 properties, and closed on only FOUR. Over those 3 years, I continually see people professing that they have an 80% closing ratio, and average 30k profit per deal. My average profit on the 4 success' was about 10k.........and that was on the higher end homes too. I had a 600k home that I made 10k, and a 30k home where I made 10k. Don't get me wrong, I'm happy that I closed on what I did, but are the numbers that I'm hearing out there from other people for real, or is it me? Marketing/exageration is out there, no doubt, and I don't have a clue if my figures are typical. Personally I feel like they're terrible, and why I continue to do this I don't know.

Here's a real life example of 95% of my deals: Home is 200k, my offer is 155k. We go thru all the short sale paperwork, then the BPO (and yes, I met them at the house with low comps, repair estimates, etc.) comes in at 195k. They turn down my offer, won't counter my offer, and the property ends up going to foreclosure............a waste of 2-4 months of dealing with the homeowner and the mortgage company.

Is this typical for most of you out here? Let me know. I appreciate any feedback.

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Thanks for this Smitty - it certainly contradicts what I've been told.  Are you in NH or MA?

But it doesn't explain why someone I know who is not a RE agent or broker, had been a lender but didn't have a current loan broker's license, was fined $15k and loss of all fees collected on SS negotiations.  This happened within the last few months.

You have to follow certain guidelines within that law.  If that person didn't follow those guidelines, I can only assume that's why they got in trouble.  I don't know as I'm not familiar with what happened. The state will go through their paperwork and make sure it's all in order, and if it's not, you can bet that you'll get a fine.

 

I'm a broker in both NH and MA.

 

I would seriously challenge the assertion that an agent who is acting as a ' go between ' would be practicing law.  The agents do not advise or make any decisions on behalf of the seller.  The agent just facilitates an exchange of information between the stakeholders . Would it be possible that it is the attorneys that are putting this misinformation around?

I think its ironic that most of you agents who are part of this web site designed to help agents close more short sales proclaim to close most of their short sales already. If that's the case .. why are you here? On the other hand, the proven national average of closed short sales in around 25%. This Eddie guy isn't that far of the national average. The next question is obvious; How many of you are lying through your teeth? I doubt anyone will start jumping up and down screaming "ME ME ME ME." I just wanted to throw this out there and let my bashing from arrogant Realtors begin (it seems to be the norm these days.)

LOL! I was waiting for that! Too many here think taking a three hour webinar and putting a fancy designation behind their name makes them an expert...

I agree with the designation thing and thinking you're an EXPERT after a weekend course, but I think the "negotiator" is a bit off.  I come here to learn, because anyone who claims they know everything about short sales is full of it.  I feel I know a LOT more than the average agent, but I'm not pigheaded to think I know it all.  Every day I learn something new.  This field is constantly changing and to have a support system like this site is instrumental in learning and becoming good.

Where is the best place to learn the most current info on short sales?  NOT from some weekend designation course.  It's from LIVE agents doing this day in and day out and if we pull together on a site like this, the MOMENT someone posts something that I haven't heard of before then haven't I done good by being a member here?  I can tell you learning the info from some designation course 4 months from now would be OLD information.

Well said Smitty.  I'd put my record and experience against anyone anyday: But I also try to learn something everyday.  The minute you think you know everything you are screwed.

this is a great site for LEARNING. with the market changing daily there aren't any agents who know everything but there are A LOT who know more than the average.you will learn more taking a SS with the determination to close it than you will learn in most classes. throwing offers at everything just wastes everyone's time. I don't have time to explain how things work to every agent or investor who wants to throw an offer into the mix. you take the offer that has the best chance of closing with the best buyer and a decent agent on the other side.

I agree with the designation thing too - its nowhere near enough to qualify an agent to prevent a foreclosure if they don't have at least an experienced mentor to guide them through the first few SS listings.  Everyone needs to start somewhere, right? 

As far as The Negotiator asking why we are here, it makes me wonder how much SS experience he has.  Those of us who have been working them know that every deal is different and what better way to give our clients the best possibility of rescue from foreclosure than to use the pooled talent and experience on this site.  I am grateful to you, Smitty and Joseph, Bryant and everyone else who contributes to this site - thank you! 

BTW, I've got a pretty darned good closing ratio too.  The only SS listing that didn't close was a seller who filed BK.  I've had some nasty situations where I've thought "this may be the one I can't close" but, when you've got the determination, knowledge, experience and resources like this site, you find the solutions.  My goal isn't to have the best closing ratio...it is to prevent foreclosure for every homeowner who wants my help.

Prospective buyer here, shopping for a primary residence in the Phoenix area.

I've bid on 4 SS homes recently; all bids were at or up to 20% above the listed price.  My Realtor advised me in each case that a higher bid had been accepted and all I could do was submit a backup offer, on two occasions I did but apparently not high enough, the deals closed within days at a price lower than what I was willing to offer.  This makes no sense to me.

All of you agree that a major factor in a successful SS is the FMV.  Why then isn't that established immediately as part of the listing to expedite the entire process?  Why does it have to be a shell game when in the end, someone must make an assessment of the FMV prior to closing the deal anyway?  I spoke with an agent recently who explained that investors were making deals with banks to buy blocks of SS listings at well under FMV.  Is this true?

If I have $200k to invest, and my offer is $175k, on a SS listed at $165k, why am I not advised that my bid was too low via a counter offer?  Instead, everything is secret; I've been told that all other offers were confidential which only leads me to believe that there is either illegal or at least unethical activity going on. Yesterday I reviewed the files I had kept over the past 18 months of the last 60 or so SS listings in my area of the specific property types that I am interested in.  Their closing price and listed price were generally within 15% of each other. From this I feel that I have some fair market trend data to base my offers on.  I don't understand why today, my bids are flatly rejected without an opportunity to counter bid. I don't understand why the FMV isn't a requirement of the listing or why the NAR for example don't regulate their industry and/or Banks make it mandatory as part of the SS approval notice to include a PBO or appraisal of their holdings to validate the listing in the first place.  Comments please.

I hate to break it to you Dan, but you were obviously NOT bidding on a short sale.  It was an REO. Short sales are a process because the lender does not have control over the property because the owner does, therefore there is a process whereby the owner applies for the short sale, then the lender does a valuation, then makes a decision to deny/counter/accept the offer submitted.  If it is any choice other than accept, the process repeats itself with new information until we get the desired result.

Wow. Bidding 10k over the asking price? Arizona's economy must me looking up.

I still notice that several people (particularly agents) are stating that I'm making LOW BALL offers on short sales. I don't really consider a 172k offer on a 200k property, THAT IS A DISTRESSED PROPERTY, a low ball offer. I'm an investor, not a gambler. If I can help the seller out in the process of doing a deal, I will, but I'm not the department of social services either. Heck, I didn't get them into their situation. I don't suppose that many agents would forgo their commission in order to "help" the home owner. There is risk in doing what I do, and I have to get good deals to make up for unseen repairs, holding costs, and such.

I've purchased some REO's, and privately owned homes for 50% of asking price, which is not so unusual in the economy that we're in right now.

Who's a good negotiating company someone can recommend? I'm bad at it, and don't really want to do it anyway.

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