Different Kinds of Short Sales??
With distressed homes still accounting for almost 30% of all real estate sales in the country, Short Sales have continued to be an option for homeowners. New programs implemented by the U.S. government and other servicers, Short Sales have become faster and easier to complete than ever before. One of these major changes has been the introduction of "proactive" Short Sales.
Traditionally, Short Sales were "reactive" in nature. Meaning: the homeowners would initiate the Short Sale process with an Agent who would then begin to market the property for a price the market would bear--regardless of what was owed. (Which is what a Short Sale is: a home in which the market price is less than what the mortgage is. Nothing else about the term "Short" has truly applied to this process.)
Once an offer was received, the Servicer would begin the process to determine if the homeowner was eligible to sell their home short. While this was the typical method, Servicers realized there was room to improve by becoming more proactive much earlier. Proactive Short Sales begin with the Bank working to determine if the homeowner is eligible for their particular Short Sale program, and then reaching out to notify the homeowner that they are eligible. If the homeowner agrees to proceed with the Short Sale process, the Bank then determines an acceptable sale price. At that time, the homeowner and agent then place the property on the market to entertain offers. Most programs feature a rigid timeframe for the Servicer to respond once a bid is received, providing greater accountability for the Agent, homeowner, Servicer, and potential buyer. (YAY! This used to take up to 3 weeks!)
Agent initiation of Short Sales works for both reactive and proactive types of Short Sales. While it is ultimately up to the Bank to begin a proactive short sale, many homeowners and Agents, for example, use the agent initiation feature on Equator (a 3rd party portal) to let the Servicer know that they are interested in a Short Sale. Proactive Short Sales greatly reduce approval timelines, improve and increase communication, create quicker sales, and ultimately reduce foreclosure rates and loss severity.
No matter what type of short sale you end up needing, I remain dedicated to helping you through the process! At this time, I have a track record of 100% closing on short sales I've had in escrow! (Not all short sales close, but about 80% do!)
