A short sale is when a bank accepts a pay off amount from a real estate transaction that is less than the amount that is owed on the loan. It is becoming more common for banks to accept short sales as it makes sense financially for them to do so. Many people do not realize that when banks seize property, it costs them money...lots of money.

Banks do not like to own Real Estate. Like any business, banks like to focus on what they are good at. Selling and Managing Real Estate do not fall under the core competencies of a bank. They prefer to stick to lending money. The best piece of short sale advice that I ever received is the following: the bank's mentality when dealing with the potential of a bank owned property is that it is better to "lose early rather than lose late". By this, they mean that it is better for the bank to take it's lumps up front (short sale) as opposed to taking their lumps later (as bank owned inventory).

Here are some key points of Short Sale Advice for Sellers:

1. Stay in constant contact with the Bank
2. Complete all of their requests in a timely manner
3. Be polite to everyone that you speak with
4. Be Honest and forth-coming
5. Remember that the job of the loss mitigation department is to Collect Money
6. Refer to Rule Number 1

Here are some key points of Short Sale Advice for Buyers:

1. Do not make verbal offers to the bank
2. Fight the urge to tell the bank to take it or leave it
3. Do not put strict time-lines into place
4. Get a Property Inspection
5. Do not talk to the bank about the Seller
6. Be polite to everyone that you speak with

Contrary to popular belief, employees in the Bank's Loss Mitigation Department are people just like you and me. I have witnessed these employees do everything short of move mountains to get a transaction done. The reason they do this, because the person on the other end of the phone was cordial, polite, and valued their time. Be sure to treat everyone at the bank with respect and temperance and you will be amazed at how much that can mean to you in terms of dollars and cents.

We help people sell short and buy short sales and foreclosures every day. Follow our link, to receive our 5 Short Sale Secrets

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