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Got Worry? Stay Calm



Listen to the Story – Even if You’ve Heard it Already

Many sellers are contacting their Real Estate agent because they’ve accepted the fact they will lose their home if they don’t make something happen – and fast. Maybe they are planners and realize that they are not going to be able to stretch the dollars quite as far as they thought. Maybe they’ve already missed some payments. Or … the letters and knocks at the door have begun….

We are hearing a lot of different stories, many of them very sad and depressing. It’s important to listen. Listen to the details even when you know how their story is going to end. It’s hard for me not to go as far as even feeling their pain. These appointments take longer, but sometimes you just have to accept that. Many times the seller(s) are opening up a very personal part of their life with The Real Estate Agent they just met when they opened the door – go ahead and just listen.

Regardless of the painful realization that often occurs with homeowner’s facing tough times and having to sell their home, it’s important that you remain the professional. That’s a hard lesson for some of us – me especially – holding back even the tear forming when I’m told that Mrs died after a painful ending, Mr’s company downsized, Brother committed suicide, and Daughter was mugged – all in the last six months.

Sometimes I Worry

I remember the day just last September when I went to pick up LittleOne5 from her first day at Kindergarten. I couldn’t wait to see her. I waited and waited in the pick up line. “She’ll be down soon, I’m sure,” Ms. Staff said. I started seeing kids that looked familiar, but it was only the first day, I couldn’t be sure they were from her classroom. “Kindergarten takes a little more time,” Ms. Staff said as she saw me start pacing. I overheard her call the office and others on the walkie-talkie. All was calm. I was fine, I could tell the situation was under control and being handled.

In an instant – the ambiance changed. Like a flip-flop turn. “Well then where could she be?!” I looked over puzzled as I could tell the mood had changed – she wasn’t calm on her radio anymore. “We have to find her! Her mother is here! She isn’t anywhere?” The professionals I had depended on for stability were no longer in control – I freaked. I began checking the other dismissal points and saw staff on their radios trying to find her.

Had the staff continued to assure me that they were taking care of the situation and had it under control – I would have remained calm.

Stay Calm, Cool, and Collected

As Real Estate Agents it is often the same way. There are many situations that fall in our laps with issues we have to deal with. Leave your emotions. Keep the professional hat on. Stay calm. Address the problem at hand using the facts while following the process and procedure you have set in place. Be the rock. Let your clients know that they are in good hands. Don’t panic. When presenting information that could cause distress – remain even keeled. When the professional breaks – the scaffolding falls.

If you worry, like I tend to – do it behind their back. It’s ok to be compassionate.

Yes, I found LittleOne5, just before they put her on a bus to who-knows-where. “But Mommy, I wanted to ride the bus!”

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  1. Matt Stigliano

    March 4, 2009 at 9:00 pm

    Kim – Awesome article. I have my article due right now, but here I sit pondering this one instead. A fellow agent and friend had a “situation” the other day and I wish she could have read this before it happened. She handled it well, but I know she was close to snapping. This article would have helped her get through it I’m sure.

    So good, I sent it to TwitThis.

  2. Dan O'Halloran

    March 4, 2009 at 9:32 pm

    Kim- This is so right on. Unfortunately more emotional financially distraught situations are becoming more common today. I think it is imperative for agents to go the extra mile- listen and respond with compassion and understand that any guidance or help no matter how small is greatly appreciated.

  3. Brandie Young

    March 4, 2009 at 9:39 pm

    Wow Kim, powerful stuff. Thanks.

    I’m not an agent, but can relate. So many people I care about have lost, or worried about losing their jobs. Each time I hear of another friend has been laid off, my heart breaks and I want to cry and/or scream when I hear the panic in their voice. It’s difficult to be optimistic without sounding Pollyanna. What helps me get through it is to offer genuine help, such as a warm introduction or a link to a job posting that may be a fit.

    At the end of the day we do need to balance steeling ourselves against absorbing the sadness/drama/negativity with compassion and a sense of community. Easier said than done.


  4. Missy Caulk

    March 4, 2009 at 10:18 pm

    I maintain my composure until I get in the car and then when I pull away, am just over taken by sadness and emotions.

    My buyers agents are all happy, happy and I am dealing with the sellers and not so yippy skippy right now.

  5. Paula Henry

    March 4, 2009 at 10:47 pm

    Kim – These are the toughest ones to handle, but I do it, because many will not, or do not. In the end, it is most often the best work I have done in this business.

    Having my child lost – that I could not handle.

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Disputing a property’s value in a short sale: turn a no into a go

During a short sale, there may be various obstacles, with misaligned property values ranking near the top, but it doesn’t have to be a dealbreaker!



magic eight ball

magic eight ball

It’s about getting your way

Were you on the debate team in high school? Were you really effective at convincing your parent or guardian to let you do things that you shouldn’t have been doing? How are your objection-handling skills? Can you flip a no into a go?

When working on short sales, there is one aspect of the process that may require those excellent negotiation or debate skills: disputing the property value. In a short sale, the short sale lender sends an appraiser or broker to the property and this individual conducts a Broker Price Opinion or an appraisal, using special forms provided by the short sale lender.

After this individual completes the Broker Price Opinion or the appraisal, he or she will return it to the short sale lender. Shortly thereafter, the short sale lender will be ready to talk about the purchase price. Will the lender accept the offer on the table or is the lender looking for more? If the lender is seeking an offer for a lot more than the one on the table, mentally prepare for the fact that you will need to conduct a value dispute.

Value Dispute Process

While each of the different short sale lenders (including Fannie Mae) has their own policies and procedures for value dispute, all these procedures have some things in common. Follow the steps below in order to conduct an effective value dispute.

  1. Inquire about forms. Ask your short sale lender if there are specific forms that you need to complete in order to conduct a value dispute. Obtain those forms if necessary.
  2. Gather information. Your goal is to convince the lender to accept the buyer’s offer, so you need to demonstrate that your offer is in line with the value of the property. Collect data that proves this point, such as reports from the MLS, Trulia, Zillow, or your local title company.
  3. Take photos. If there are parts of the property that are substandard and possibly were not revealed to the lender by the individual conducting the BPO, take photos of those items. Perhaps the kitchen has no flooring, or there is a 40-year old roof. Take photos to demonstrate these defects.
  4. Obtain bids. For any defects on the property, obtain a minimum of two bids from licensed contractors. For example, obtain two bids from roofers or structural engineers if necessary
  5. Write a report. Think back to high school English class if necessary. Write a short essay that references your information, photos, and bids, and explains how these items support your buyer’s value. This is not something that you whip up in five minutes. Spend time preparing a compelling appeal.

It is entirely possible that some lenders will not be particularly open-minded when it comes to valuation dispute. However, more times than not, an effective value dispute leads to short sale approval.

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Short sale standoffs: how to avoid getting hit

The short sale process can feel a lot like a wild west standoff, but there are ways to come out victorious, so let’s talk about those methods:



short sales standoff

short sales standoff

What is a short sale standoff?

If you are a short sale listing agent, a short sale processor, or a short sale negotiator then you probably already know about the short sale standoff. That’s when you are processing a short sale with more than one lien holder and neither will agree to the terms offered by the other. Or… better yet, each one will not move any further in the short sale process until they see the short sale approval letter from the other lien holder.

Scenario #1 – You are processing a short sale with two different mortgage-servicing companies. Bank 1 employees tell you that they will proceed with the short sale, and they will offer Bank 2 a certain amount to release their lien. You call Bank 2 and tell them the good news. Unfortunately, the folks at Bank 2 want more money. If Bank 1 and Bank 2 do not agree, then you are in a standoff.

Scenario #2 – You are processing a short sale with two different mortgage-servicing companies. Bank 1 employees tell you that they cannot generate your approval letter until you present them with the approval letter from Bank 2. Bank 2 employees tell you the exact same thing. Clearly, in this situation, you are in a standoff.

How to Avoid the Standoff

If you are in the middle of a standoff, then you are likely very frustrated. You’ve gotten pretty far in the short sale process and you are likely receiving lots of pressure from all of the parties to the transaction. And, the lenders are not helping much by creating the standoff.

Here are some ideas for how to get out of the situation:

  • Go back to the first lien holder and ask them if they are willing to give the second lien holder more money.
  • Go to the second lien holder and tell them that the first lien holder has insisted on a maximum amount and see if they will budge.
  • If no one will budge, find out why. Is this a Fannie Mae or Freddie Mac loan? If so, they have a maximum that they allow the second. And, if you alert the second of that information, they may become more compliant.
  • Worst case: someone will have to pay the difference. Depending on the laws in your state, it could be the buyer, the seller, or the agents (yuck). No matter what, make sure that this contribution is disclosed to all parties and appears on the short sale settlement statement at closing.
  • In Scenario #2, someone’s got to give in. Try explaining to both sides where you are and see if one will agree to generate their approval letter. If not, follow the tips provided in this Agent Genius article and take your complaint to the streets.

One thing about short sales is that the problems that arise can be difficult to resolve merely because of the number of parties involved—and all from remote locations. Imagine how much easier this would be if all parties sat at the same table and broke bread? If we all sat at the same table, then we wouldn’t need armor in order to avoid the flying bullets from the short sale standoff.

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Short sale approval letters don’t arrive in the blink of an eye

Short sale approval letters may look like they’ve been obtained simply by experts, but it takes time and doesn’t just happen with luck.



short sales

short sale approval

Short sale approval: getting prepared, making it happen

People always ask me how it is that I obtain short sale approval letters with such ease. The truth is, that while I have more short sale processing and negotiating experience than most agents and brokers, I don’t just blink my eyes like Jeannie and make those short sale approval letters appear. I often sweat it, just like everyone else.

Despite the fact that I do not have magical powers, I do have something else on my side—education. One of the most important things than can lead to short sale success for any and all agents is education.

Experience dictates that agents that learn about the short sale process
have increased short sale closings.

Short sale education opportunities abound

There are many ways to become educated about the short sale process and make getting short sale approval letters look easy to obtain. These include:

  • Classes at your local board of Realtors®
  • Free short sale webinars and workshops
  • The short sale or foreclosure specialist designations

As the distressed property arena grows and changes, it is important to always stay abreast of policy changes that may impact how you do your job and how you process any short sale that lands on your plate.

The most important thing to do is to read, read, read. Follow short sale specialists and those who blog about short sales on AGBeat, Google+, facebook, and twitter. Set up a Google Alert for the term ‘short sale’ and you will receive Google’s top short sale picks daily in your email inbox. Visit mortgagor websites to read up on their specific policies and procedures.

Don’t take on too much

And, when you get a call from a prospective short sale seller, make sure that you don’t bit off more than you can chew. Agents in most of America right now are clamoring for listings since we are in the midst of a listing shortage. But, if you are going to take on a short sale, be sure that it is a deal that you can close. And, if you have your doubts, why not partner up with a local agent that can mentor your and assist you in getting the job done? After all, half a commission check is better than none!

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