Does the mortgage lender really care?
As the owner of a local real estate brokerage and affiliated third party short sale negotiation company, I have seen more than my fair share of short sale transactions. I’m not sure if the volume has caused me to become more objective or if I am merely objective by nature. But, I do believe that in order to be successful in getting what you want (like a short sale approval letter), you need approach your work in an objective fashion.
Here’s the deal (and pardon my candor): The bank does not care what you want, think, or feel. The bank does not care that the seller is going to turn off the water and the plants are going to die. The bank does not care if the seller is in a fight with the tenants. The bank certainly does not care that the buyer needs four thousand dollars in closing costs when only three thousand dollars will be approved.
I have had hundreds of individuals (both agents and borrowers) say “Tell the bank this,” or “Tell the bank that”, as if the bank is an actual thinking, feeling being.
The good news is that most of the employees who work in loss mitigation departments at the lending institutions are thinking, feeling beings. Just like you, they want to get the job done and get the short sale closed. So, instead of saying that the seller is turning off the electricity (something the bank may not care about), you need to think strategically and try to present short sale options that will appeal to the bank.
Say, for example, that the investor (note holder) refuses to provide more than three thousand dollars for the closing cost credit, but the buyer needs four thousand because he does not have enough cash on hand. First, double check with the lien holder to make sure that this issue is non-negotiable. Then, ask whether the investor might be willing to pay the four thousand dollars, if the offer were increased by a grand. In this way, the investor still makes their net amount (and that’s what they want). The buyer gets his four thousand and that’s what s/he wants.
Short sales involve flexibility and objectivity. If you want to close them regularly, you need to be a problem solver not a problem maker.
I am very passionate about what I do. I love short sales because they teach me to think in new and different ways to solve every day problems. If you find yourself talking about the transaction as if the bank were a thinking, feeling being, I would advise you to step bank and take a breath and try another technique. And, as I cautioned in my last post, there’s always yoga, chocolate cake, and martinis. Of course, when negotiating short sales, it helps to have a little bit of skill as well.
Photo: flickr by avlxyz