Filed under: Uncategorized
So client X thought it would be helpful to share the hardship letter he sent in to his lender along with his short sale package. It’s kinda scary to say that this letter hasn’t been changed in any way, nor has it been embellished- this is all true stuff:
“Dear Loss Mitigation Manager,
I have been paying the debt on loans xxx and xxx to the best of my abilities at the address; xxx. The amount of these two loans totals approximately $174,000.00 and the property value as I have seen through comps of the area is roughly $55,000.00. Despite the difference in these numbers I continued to make my payments in hopes that the economy would rebound and bring my property value back up.
Unfortunately, the best intentions can still have unpleasant outcomes and I am currently unable to continue to pay for my house. My wife lost her job for a few months a year ago and things have been a struggle ever since then. She was able to get another job later but with a reduced income. To the best of my knowledge she is still employed but I was laid off from my job about four months ago and haven’t been able to find anything that will provide the same income that allows me to take care of my mortgage. Since then, my wife also left me and I’m currently going through a divorce. Needless to say, between being unemployed and not having my wife’s income my money for bills has been reduced to almost nothing.
I tried to reduce my costs in hopes of maintaining ownership of the house by disconnecting my cable, disconnecting my internet service and not using my air conditioner or heater unless necessary. I even sold all of my furniture to use the money for bills. In addition I have been applying for jobs in and out of my field of expertise and have not had any leads come to fruition. I’m sure you don’t need me to tell you what the unemployment numbers are like in the country and especially Arizona but it has been extremely hard to even find places that are hiring.
Due to this, I honestly feel that the best solution is to attempt a short sale of my house in an effort to repay as much debt to the mortgage company as possible. Although I understand that a short sale of my property isn’t ideal, I do not wish to foreclose on the house or file bankruptcy if I can avoid it. I feel that a short sale would be the best alternative to these options and hope that a compromise can be reached.
Thank you for your time in reading this letter and considering the information above. If you have any questions or would like details on anything I would urge you to contact my attorney at xxx.”
Filed under: Uncategorized
Filed under: Economy, Short Sale, clients, selling | Tags: Avoiding Foreclosure, Owners Perspective, Sellers Perspective, Short Sale, Short Sale Story
Client X: “I met with Joe a couple days ago to start filling out paper work to do the short sale on my house. Since I have already started to get rid of furniture we decided to go to a restaurant across the street so we had a decent table to work at. The fact that I had a coupon for free chips and guacamole helped a lot in this decision. The paperwork seems fairly straight forward with the main exception being the portion for the lawyers. I understand the main gist of it but I don’t want to focus on it too much I guess. According to the lawyer paperwork there is a fee that goes along with their paperwork which I believe I will have to produce before I can meet with them and have them go to bat with the mortgage company for me. I honestly have no idea how I’m going to make this happen since I currently don’t have a job but I’m hoping I will figure something out.
If everything goes according to schedule I will be listing the house one week from today and will be moved out of the house at the same time. It’s really hard to live in a house for one week because there are certain things that should need to be packed but I can’t pack until I leave. That being said, it’s almost like camping in a house right now. Despite the fact that I will be losing a lot of money by going this route I still feel that it will be better for me in the long run as compared to doing a deed in lieu of foreclosure or just a foreclosure. I’m trying really hard to not think about the amount of money I will lose and focusing on the next residence and the next opportunity that presents itself.
I am very curious to see how much interest there is in my house. I have always loved it but I suppose this really opens it up to public opinion. I also have some work to do on the house over the next week or so to get the house presentable. I don’t believe there is much to do as far as fixing things so much and just a solid cleaning of the house. Most of the things the Joe suggested weren’t a surprise to me and were things I had planned on taking care of anyway. Ideally I want people to fall in love with this place just like I did when I came to look at it. That can’t really happen though if I’m not taking care of it.”
Filed under: Economy, Short Sale, clients, selling | Tags: Avoiding Foreclosure, Owners Perspective, Sellers Perspective, Short Sale, Short Sale Story
So I, like the rest of you see a lot out there about Short Sales- they are everywhere, especially if you work, live or breathe around the world of Real Estate.
However, what I have NOT seen much of is the impact of Short Sales (financially, emotionally and otherwise) on Sellers from the Seller’s point of view. I think that most people have very specific opinions of who these people are, what their situations are and what led them to those situations. I also think that in many (most) scenarios, those opinions are probably not entirely accurate.
So without further ado I present “Short Sale Story” a series of posts written by and told through the eyes of Client X. This IS intended to be a discussion as well, so if you have questions for me or Client X, please feel free to leave a comment.
Client X: “Due to a number of different issues involving divorce, jobs (or lack thereof), finances and the economy I’m forced to give up my house in hopes of salvaging what little I can of my life and hope to start over someday. Obviously this is not an ideal situation and I will be losing a substantial amount of money “on paper” during this process. However, it is clearly better than going into foreclosure so I’m giving this my best shot in hopes that I can find a buyer and I can get out of a loan that I am severely upside down on (thank you to the people that helped destroy the economy. I owe you one…seriously.)
At any rate, I’m currently reading through the paperwork and trying to wrap my head around the different items that will need to be accomplished. The thing I keep going back to is that just because it’s a short sale doesn’t mean that I shouldn’t have the house completely presentable. I have a few things that I need to take care of which will help the house be more presentable and hopefully sell faster.
The other item I keep reminding myself is that there is really nothing to be embarrassed about in regards to taking the short sale route to remedy this situation. I think at this point selling the house is the most responsible thing I can do as compared to ignoring the problem at hand until I’m given an auction date and eviction notice. I’ve never been one to stick my head in the sand and I fully intend on facing this head on. I truly feel that with my realtor, my family and my friends on my side I will make the absolute best of a bad situation.
That being said, the plan is to list the house next week and hopefully get some interest and see where it takes me. Right now “hopefully” seems to be the key word for me.”
So my 4th client appreciation event (The long awaited PJ Party) is now in the history books… phwew! Tons and tons of work, planning, confirming and too many thoughtful touches to list (thanks to Jenn) culminating in a 3 hour “professional” party- Not a bad way to spend your marketing budget!
These events have been an absolutely incredible and invaluable part of my business. They are my opportunity to reconnect with and most importantly to thank my friends, family and clients for all they do for me and my business. The days of Realtors showing appreciation through calendars and magnets are behind us, (IMHO) they are impersonal, static and they don’t send a message. Well, they don’t send the right message- they say “Think of me everyday, send me business everyday and I will think of you once a year to keep you thinking about me”.
Sure I want business from my clients, but I want to talk to them more often than when they are sending me a referral. My events are all about sending them the right message- the ”I want to talk to you, maybe over a drink, maybe next to the music, but I want to talk to you- And not just about Real Estate” message.
So what are these events all about- They are soooo totally simple it is amazing. Get a bunch of really cool people together, give them yummy food and drinks all centered around a really cool, central theme (again, thanks Jenn) and let them hang out. It’s such a cool thing to look around a room full of people and see your friends, your family and your clients all interacting, networking, learning and just having fun. There is no pressure to ask for or give referrals- that stuff happens way more naturally when you have connections like this.
What am I missing you ask? See for yourself! How do I get to go you ask? You get to know me or my super marketing genius wife, Jenn and we invite you 
Filed under: Uncategorized
You know that feeling you get when you know that you know your stuff? You can be in any situation, field any question and come out feeling like you are truly an authority in your field… that feeling. My entire professional life, I have taken pride in that feeling. I work my ass off to get that feeling and it’s great!
Today, I got to feel that for someone else- My wife Jenn. I sat in on one of her classes this morning and was totally blown away at how damn good she is. It was such a cool feeling and it totally occurred to me… this IS the feeling of being proud. Not the “thank god she turned that wallet in, I am proud of her” thing, but the “that’s right, my wife kicks ass!” thing.
Absolutely Awesome!
Why is it that people are so short sighted? I am amazed at how many people consistently try to squeeze out a bit more money from a job, a client, a friend. Does no one realize that they will get that money, but they WILL completely screw themselves out of the opportunity for more business from that contact in the future?
I am convinced that this is one of the final stages of the economy crapponizing and must indicate that things will turn up.
Filed under: Economy, Relocation, Stupidity, buying, clients, first time buyer | Tags: clients, Economy, fist time home buyer, Relocation
People are smart and companies are STUPID! – That’s it… please allow me to illustrate:
I am working with some buyer clients; a great couple- first time buyers, great credit, motivated to get into their first home, etc… these people are EXACTLY who should be benefiting from the “Insert Expletive Here” market we are all struggling through.
We have been working together for a few weeks now and in the course of our searching, we come across a great place in Gilbert, listed at $165k. Looking at the listing sheet, I was thrilled to find out that this is not a lender owned property (as MANY are these days under $200k) but rather a corporate relocation. Being trained as a corporate relocation specialist, I am very comfortable that I will be dealing with a system with which I am very familiar.
In the course of our due diligence prior to submitting our offer, we find out there is already an offer in on the property. I don’t know what the offer is, but I have been told that it is a less than full price offer. My clients come to the decision that we will submit our offer in the “highest and best” manner and cross our fingers. Our offer is:
Purchase price – $165,000 w/ Seller contributing 3% ($4,950) to cover Buyers closing costs. NET TO SELLER: $160,050
We submit, and we wait. I get a call from the agent that the Seller (the homeowner’s employer) has countered. No biggie, it always happens, “So what is it?” I say. She tells me:
Purchase price – $155,000 w/ Seller contributing 0% to cover Buyer’s closing costs. NET TO SELLER: $155,000
Do me a favor at this point and take a look at the two scenarios I have put up here. Our offer has the Seller netting over $5,000 MORE than their counter offer. I ask the listing agent “Are you sure this is right?” She tells me it is and explains that the Seller has a contract with the homeowner / transferee that they will cover the mortgage but no “Non-Customary” costs, ie: the closing costs we asked for. Intrigued I say “Well, it’s interesting and I will take it to my clients”.
Sure enough, as great as the deal sounds, my Buyers just can’t do it. It is simply a cash issue. They recognize that they would make out better on paper with the Sellers offer, but it’s no good if they don’t have the cash. I go back to the listing agent and tell her our situation. She agrees to take it back to the Seller and “Go to bat” for my clients.
Next day I get a call from the listing agent- “They said NO”. Completely perplexed, I go back to my clients and tell them that we are back at square one- Time to start over.
I’m driving after this conversation and this whole thing is just not sitting right with me. So I call the agent back again and have a very friendly, but very pointed conversation with her. I explain to her that I am having a hard time explaining this to my clients, and I am realizing that it’s because it makes no sense to me. So I ask her to please clarify how this offer is being rejected.
The listing agent goes on to tell me (while sharing her frustration) that even though she knows our offer is better for the Seller, even though the homeowner knows it is better for the Seller and even though the Seller knows that the deal is better for them, the fact is that they have a contract with the homeowner and this contract says NO CLOSING COSTS. “So their contract trumps logic?” I ask “Yes” I get back…. And that’s pretty much it.
So here are my thoughts- while the whole world is searching for the reason that our economy is in the crapper, why millions of Americans are being laid off, why Real estate values are soooo down, pretty much why things suck- I have it figured out. People are smart and companies are STUPID! Every person I spoke with about this scenario recognized that it made no sense but admitted that there was NO opportunity for Human Intervention. There is no one able to go above the almighty contract and make a decision that is better for the Buyer AND the Seller.
So besides just listening to me vent about this, please allow me to break down for you the result of this stupidity, and how it affects me, you and EVERYONE who reads this.
Because of this contract that could not be worked around, the other offer submitted on this property was accepted. This means that the Seller, a MULTI BILLION DOLLAR BIG NAME PHARMACUTECAL COMPANY (whos name starts with a “P”) has accepted an offer that is netting them approximately $20,000 less than our offer. What does that mean for you and everyone else? A few things:
- This home has gone been sold to an investor and is now at a greater risk of being abandoned should that investors financial situation take a turn for the worse. For Example, I don’t live there, so why should I stretch to keep paying for it.
- The $20,000 lower sales price means that this home will now become a lower sales comp for the entire neighborhood. This means that neighbors who sell for months to come will have their home valued lower because of this sale.
- The listing agent who worked diligently to perform her duty and bring her clients the highest and best offer possible will now make less money and have less money to spend since her compensation is a function of the sales price.
- The pharmaceutical company who was at the helm of this deal has now lost an additional $20,000 on this transaction. I hope this does not come as a surprise to anyone reading this, but losses like that do not get absorbed into the massive black hole that is big pharmaceuticals. This loss will be split up a teeny tiny bit across EVERYONE who relies on the drugs that this company manufactures in the form of higher drug costs meaning there are literally millions of people who will be affected by this transaction.
Now imagine this scenario playing out thousands of times a month. Thousands of decisions being made on policy and NOT on common sense. THIS IS THE PROBLEM PEOPLE!!! The world has lost its way by refusing to allow common sense to correct a problem that is heading things in the wrong direction. Now more than ever, it is the responsibility of every individual to apply common sense in their life and their career as well as demand it of those whom are make decisions for them. Get on it people! Of course, if you disagree, please feel free to let me know 
Soapbox Out!
