How to
REALTOR, Know Thyself
I am a musical anachronism
Kari and I are a little bit odd in our musical tastes. Oftentimes, we think we might have been born about 30 years too late. At 28 years old, ask us who are favorite singers are, and no one from the last 25 years is like to make the top 5.
This became readily apparent a little over a week ago when we attended the Neil Diamond concert here in Charlottesville. Our last three concerts in Charlottesville have been, Neil Diamond, Elton John, and Billy Joel. 🙂
Billy Joel was outstanding, Elton was just ok. Honestly, we weren’t exactly sure what to expect from Neil Diamond, especially since we were a little disappointed by Sir Elton.
Neil did not disappoint.
Neil Diamond delivers
One of the things that immediately struck us about the Neil Diamond concert was that it was exactly what you might expect it to be, which was a little bit surprising, actually. It wasn’t terribly fancy. The stage wasn’t crazy elaborate. It was just Neil, his guitar, a microphone, and his band and backup signers. By the way, it was his ORIGINAL band and backup singers. All the same folks for over 30 years now. Pretty impressive.
When you have a catalog of songs as impressive as that of Neil Diamond, and you have simultaneously released a new album, that offers quite a conundrum– sing new songs, or sing the songs everyone knows and loves? Much to the delight of the crowd, Neil didn’t shy away from his old standards. Sure, he did 3 songs off the new album, but one after the other, and almost as a kind of “intermission” in the concert.
The end result was that everyone in attendance, all the Neil Diamond fans that have been loyal for more than 30 years, got exactly what they wanted– they got to relive all those great memories from those great songs.
Neil knows exactly who he is, and he doesn’t apologize for it. He doesn’t try to hide it. In fact, he revels in it. He uses it to his advantage, and he makes the most of it.
Who are you? Be that person.
As REALTORS, we often worry about marketing, finding a niche, and branding. We worry about what makes us unique, what makes us stand out from the thousands of other REALTORS in our markets.
The one thing that makes you unique is– YOU.
No one else is you. No one else can ever be you. Sure, people can be similar, but that can’t be exactly the same. You know what, there are potential clients out there who will be attracted to you, because of who you are, so don’t be afraid to show it.
If you are a numbers person, use it. Share stats, get into the MLS and pull out the crazy statistics that only you can find.
If you are a people person, use it. Get out, go to events, shake hands, kiss babies.
If you are a service-oriented person, use it. Volunteer, meet people, deliver service to your clients, help them.
Whoever you are, you have strengths and talents that you can bring to bear that will help you grow your business and succeed.
Neil Diamond has been signing “Sweet Caroline” for decades. Every time it plays, the crowd still sings along. What do you do well that will attract a crowd?
Coaching
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!
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.
- 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.
- 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.
- 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.
- 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
- 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.
Coaching
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:
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.
Coaching
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 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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Derek Overbey
December 18, 2008 at 12:58 pm
First off Daniel, I absolutely love Neil Diamond. He’s like a fine wine. Keeps getting better with age. But on to the actual topic. I agree with you in the fact that agents need to be who they are. I can’t tell you all the times I would get approached when I was running the marketing department of a large regional brokerage by agents who would want to do this because Agent X is doing or try this because Agent Y saw success. I would always ask them if that was what “they” wanted to do and they would almost always say no. Then we would sift through their style, personality and coverage area and tailor a program to fit their needs and the needs of their clients.
ARDELL
December 18, 2008 at 1:43 pm
Hi Daniel,
Niche = being yourself…in the right place 🙂
When the day comes that Neil can perform at X with 0 audience members vs. performing at Y with a packed house…he will still be himself, but he won’t perform at X anymore.
Knowing where Y is, is the order of the day in a marketplace of dramatically diminished volume.
Brian Block
December 18, 2008 at 3:02 pm
My wife (on my request) bought us tickets to see Neil Diamond for my birthday a few years ago in D.C. He still puts on a helluva show and though we were some of the youngest in the audience, I’ve always been a Diamond fan.
A very nice thought-provoking post.
Every agent has fridge magnets and “I Love Referral” stickers — but that doesn’t separate you from the pack.
ARDELL
December 18, 2008 at 5:55 pm
Brian,
I have never, ever had “I love referrals” stickers. They make me puke.
Jonathan Dalton
December 19, 2008 at 1:55 am
How many times did he sing a finish to Sweet Caroline? I think we got up to four here in Phoenix two months back.
Neil delivers, plain and simple. Absolutely amazing for someone nearing 70 to still strut and emote and … well … be Neil.
As for the real topic, I’m off to listen to Song Sung Blue.
Missy Caulk
December 19, 2008 at 10:23 am
At our church last week they took all the Neil Diamond songs and changed the lyric to recruit kids to mission work over Spring Break, my husband and I were cracking up.
The problem…the majority there were U of M students and except for Sweet Caroline they just didn’t get it.