Fiduciary obligations of a short sale listing agent
An agent contacted me the other day to ask if the bank would prefer a 10-day closing or a 30-day closing. I understand that agent’s mindset, and you probably do too. He wants to get this short sale through the lender’s system as quickly and efficiently as possible and he will do whatever possible in order to see that happen.
However, the constant tightrope that is walked by short sale listing agents is getting tougher to manage. It can be challenging for short sale agents to strike a balance between the fiduciary obligation that they have to the short sale seller and providing the short sale lender with a transaction that meets their needs.
Short Sale Balancing Act
Here are three situations where short sale listing agents may be struggling to do that balancing act:
- Selecting the highest offer or selecting the best offer. I’ve often said that highest and best are not synonymous in short sale transactions. The highest offer may come from a buyer that wants termite work, a septic tank certification, and a 60-day closing. The lowest offer may come from a cash buyer that may not be around when the short sale approval finally arrives. The key is to select an offer from a well-qualified buyer that is willing to accept it when the bank changes some of the terms and conditions of the purchase.
- Allowing the bank to dictate the sales price without question. Many of the troubles associated with short sales occur when the valuation comes back from the short sale lender. Often the lender states that they want a certain purchase price, based simply on their valuation. This valuation may be wrong. And, if you believe that it is, don’t give up hope. Ask about the guidelines for valuation dispute, and prepare to submit your dispute with the appropriate information.
- Allowing the bank to specify how the home is marketed. There has been a lot of hubbub these days about some lenders requiring properties to be listed on Auction.com Others have stated that the lender wants the property Active on the MLS for a specific number of days, and one lender even specified the language for the MLS. Know that your state association and local MLS have rules. If you believe that the lender will be violating those rules, don’t be shy about using this time as an educational moment.
As far as my call from the agent, I asked him whether the seller would prefer a 10-day closing or a 30-day closing. After all, short sale listing agents represent the seller and not the bank.
Austin tops the list of best places to buy a home
When looking to buy a home, taking the long view is important before making such a huge investment – where are the best places to make that commitment?
Looking at the bigger picture
(REALUOSO.COM) – Let us first express that although we are completely biased about Texas (we’re headquartered here, I personally grew up here), the data is not – Texas is the best. That’s a scientific fact. There’s a running joke in Austin that if there is a list of “best places to [anything],” we’re on it, and the joke causes eye rolls instead of humility (we’re sore winners and sore losers in this town).
That said, SelfStorage.com dug into the data and determined that the top 12 places to buy a home are currently Texas and North Carolina (and Portland, I guess you’re okay too or whatever).
They examined the nerdiest of numbers from the compound annual growth rate in inflation-adjusted GDP to cost premium, affordability, taxes, job growth, and housing availability.
“Buying a house is a big decision and a big commitment,” the company notes. “Although U.S. home prices have risen in the long term, the last decade has shown that path is sometimes full of twists, turns, dizzying heights and steep, abrupt falls. Today, home prices are stabilizing and increasing in most areas of the U.S.”
Average age of houses on the rise, so is it now better or worse to buy new?
With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.
The average home age is higher than ever
(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.
With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.
Prices of new homes on the rise
Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.
Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?
The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.
Why Realtors are vulnerable to these rapid changes
(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub, Realtor.com, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.
Note: We’ll let you decide which company plays which role in the image above.
So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.
1. Zillow poaches top talent, Move/NAR sues
It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also Realtor.com’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.
Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.
2. Two major media brands emerge
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