Good afternoon,
I have two agents that are interested in guiding me through the short sale process.
The 1st has CDPE designation and claims to have closed an average of 30 short sales per year for the past two years. This agent was referred to me by a friend, but the agent was not able to close a short sale for the friend. I guess that could be indicative of an issue with the bank or offer(s) as much as anything else. The agent did help them with a DIL.
The 2nd agent is less experienced, but claims that her 3rd party negotiators close 95% of the short sales she brings to them. I'm not sure if her 3rd party has worked with my bank (NFCU).
The 1st agent works with a distressed property startup that consists of a number of realtors that came over from a big name realty company. The 2nd is with Keller Williams (I hope I can say that).
I'm leaning towards the first based on her experience, but a 3rd party that is experienced in negotiating with my lender interests me.
Thanks!
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The 1st agent with CDPE that has closed at least 60 short sales sounds very promissing. You would have direct contact with the actual person doing the short sale. The less parties involved, the better, in my experience.
How many transactions has the inexperienced agent had with the 3rd party company? Numbers are important in addition to successes.
Whom do you feel comfortable with and feel you can trust?
I like to do the negotiating myself and have done at least 30 short sales. There are no guarantees of success, however, having the knowledge, experience, training and direct contact with the Borrower, bank and negotiator, & the other Agent is crucial. The person doing the short sale with a high success rate already has a system in place and has dealt with many banks. The success of a short sale is subject to several factors - the Agent's experience, persistence & skill in solving problems, the bank, the negotiator, the purchase offer & Buyer's ability to be patient with the process and finance it ,and the BPO. Also, the cooperation of the Borrower of course.
I've heard about successful 3rd party companies from agents that use them. So some companies are also experienced and have the numbers, however, I've heard some agent decide to finally do them themselves because of the control and communication.
As others commented - check their numbers
Good Luck,
Lillie
Alyce,
I'd really like to talk to you about your response - it doesn't necessarily pertain to this particular conversation string, except in a personal way. I hope you don't mind sharing.
You can reach me at RealHillsLiving@gmail.com
Thank you!
Alyce Nelson said:
I am both a 3rd party negotiator and CDPE Licensed REAgent and tell you from experience a CDPE certification is no guarantee, just means they passed the test, experience is key. I agree with Jeff, ask them for proof of their number and/or a referral. Also ask for proof of MARS compliance, I had all my docs redone to be MARS compliant. 3rd party negotiators get a bad rap, all the ones are know are solid and ethical business people who abide by the rules and charge reasonable fees. I don't like the agent stuff, but LOVE negotiating short sales and am very good at it... a 95% success rate for a negotiator actually sounds low to me. I have a SS with NFCU going right now and it’s going well, but it’s an easy one, so probably not a good test for your situation. In general, credit unions will push harder for a seller cash contribution and/or prom note, there also seems to be a greater percentage of MI (Mortgage Insurance) on credit unions loans, so be sure to ask up front if there is MI on the loan. If there is, you can probably count on a cash contribution at close... can get nasty. Be sure who ever does your short sale has experience with credit unions and MI. A good negotiator will know how to navigate this scenario and get the job done. Since you asked… I’d vote for the 3rd party negotiator ;) All the best!
Harry Clay said:
I've decided to go with the realtor that will do the negotiations herself. My reasons are:
1. Significant experience closing short sales.
2. Her focus is short sales, which assures me she will be invested in our case.
3. I am confident that I will be able to speak directly with the person negotiating on our behalf.
Those things may be true with a third party, but there are simply too many additional people involved for my comfort.
Thanks for everyone's excellent advice. I appreciate your willingness to share your experience and knowledge.
Obed, There are PLENTY of Realtors who had never done a short sale and had to start somewhere, which I'm going to assume is the same as a 3rd party negotiator. The other thing is MANY 3rd party negotiators ARE licensed agents. Now, does that mean they all are...NO because most states don't require licensure for 3rd party short sale negotiation. Are you saying because they may be unlicensed they aren't qualified to negotiate a short sale? Of course not. Lawyers are licensed and I can tell you I've worked with a few and sorry...they were HORRIBLE at short sales. Just because you have a license doesn't mean you know the ins and outs of short sales.
Listing a property and helping market a property for a seller is not the same as negotiating a short sale. An agent who has experience marketing and selling property may be excellent. There are a lOT of old timers in my area who know how to get property sold that don't necessarily know how to deal with a lender, who isn't allowing $3500 to second lien holder. I commend that agent for knowing they don't have that experience, and outsourcing negotiations.
Smitty said:
Um...I have to chime back in but Robert is dead wrong. MARS RULINGS ONLY COVER LAWYERS, and then even so lawyers have to adhere to certain guidelinest to be exempt. No Realtor is exempt from having the MARS FTC disclosures in their paperwork. Also, any third party can negotiate, so long as they do not charge up front fees and comply with the laws of their state and have MARS FTC disclosures in their paperwork.
Also, keep in mind in Realtor history, negotiating short sales is fairly new to MOST Realtors. There are some Realtors that have done it for quite some time, but mostly Realtors got into negotiating short sales BECAUSE THEY HAD TO. It was the only way to get all this distressed property sold so when the housing market crashed, Realtors were pretty much forced to learn how to negotiate short sale. Things started to go down in 2007 so it's fairly new to most Realtors.
I also have seen exactly what Tasha said that many agents use them when they don't have experience. THAT'S EXACTLY why SOME 3rd party companies get hired. Realtors typically should be very careful if they decide to negotiate a short sale, which is why there is no exemption for them under the Safe Act OR MARS. Any Realtor can ask their E/O company to see if they are covered and most E/O companies will say HECK NO because of the liability. So I actually think an agent who hires a 3rd party company that doesn't have a lot of experience in short sales is doing EXACTLY what they should be. They DON'T want the extra work OR LIABILITY associated with a short sale, so they hire a 3rd party company to do it for them. I would much rather deal with a 3rd party company that negotiates 24/7 than an agent that has no experience.
Not all agents are equal and not all 3rd party companies are equal.
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