Living in Portland

As a Buyers Agent, I write more Sales Contracts than the average Realtor.  Not because I’m better, but because I don’t write any Listing Contracts and 99% of all Realtors do both.  A few years ago when we were at the height of the Sellers market I was writing an average of 2.5 Sales Contracts for every buyer. The reason was most homes had multiple offers and sold for more than the asking price. This situation was neither fun no stress free for either of us. When that era came to an end and real estate returned to normal (hooray), my Buyers and I could expect that a written Sales Contract would be negotiated to a successful close.

Then along came short sales.  In my 18 years of selling real estate in Portland, I had never written a Short Sale Contract until this past year.  I would gladly go back to dealing with multiple offers over short sales. There are two reasons for that.  First with multiple offers we were dealing directly with the Sellers and second we received an answer back within 24 hours.  The pain was sharp but it was fast.  Today with short sales we are dealing with Banks who often don’t know what they are doing and take weeks even months to respond. Sometimes they don’t respond at all.  The pain just keeps going and going…..

Let me tell about the last three Short Sale Contracts I wrote each for a different Buyer.  The house we wrote the offer on had an already accepted offer but the Buyer ran into financing difficulties and it sale failed.  Our offer was accepted in writing within 48 hours.  Clearly a new world record.  The property had a first and a second mortgage both with City Bank.  Life was good until we arrived at escrow to sign the loan documents.  The escrow officer called City Bank to confirm the wire transfer instructions and was told that the second mortgage had been sold three days earlier.  They were very sorry but could no longer convey clear title so the deal was off. Remember, we had written approval. Due to the heroic efforts of the John L Scott listing agent, a deal was agreed to with the new investor and the house closed two weeks late.

My second offer was on a condo that has both a first and a second with different banks.  According to the listing agent the bank is hard at work and we should hear something soon.  That was three and a half weeks ago and we are still waiting.  Any bets on this one?  UPDATE 10/10/09  Nothing has happened and the Buyer is moving on to another property.

My third offer was on a new construction house that had three other offers.  Since my buyers were very strong and willing to pay more than the asking price we went ahead and submitted an offer.  Two days later the listing agent informs me that the home is scheduled for foreclosure in 10 days.  Since the second mortgage bank was unwilling to work out a deal, we decided that a foreclosure would be a good thing.  You see in a foreclosure, the second mortgage gets wiped out which leaves the first mortgage bank free to accept one of the four offers already written on the property.   Or so logic would have it.  Apparently the asset manager that handles short sales doesn’t handle BPO’s and therefore has no choice but to move the file on to the BPO department.  Of course he has no idea who that is or where they might be located, so his advise was to wait until the property was listed again in say three to nine months.  Another one bites the dust.  UPDATE 10/10/09  This property did come back on the market as a Fannie Mae Foreclosure on August 14, 2009.  We made a full price offer that same day that was accepted.  On October 9, 2009 this transaction closed and my Buyers got the keys to an awesome property at an awesome price.

I along with my Buyers have decided to avoid the stress and only look at houses that are truly bank owned or Seller owned.  Webster defines available as: obtainable or accessible and ready for use or service.  When you get right down to it, short sales really aren’t available for sale are they?