Blog post written by John Boles and edited by Kasey Boles
Short Sale Fail – A Series on Questionable Things I Run Into With Short Sales: CDPE Disclosure
When working with buyers I often run into listing agents forcing the use of forms that leave me wondering. For instance I was showing a house this past week and the agent included the below form as a document to be included in a contract. It is a CDPE form (Certified Distressed Property Expert). I know some CDPE's who are great short sale agents, but I also know some who have sold little to no short sales and simply have the designation because they took the class. On a side note, make sure that if you are interviewing short sale agents you don't only look for designations such as this but you also ask them two very important questions -
1)How many short sales have they successfully closed?
2) What is their close ratio (short sale listings taken to once that actually proceeded to closing)?
Number one is important because though no short sales are exactly the same, you want to make sure that they have the experience and knowledge necessary to complete your short sale. Number two is additionally so important because you don't want to be just another number in the failed short sale pile. In our area of Boise, Idaho and surrounding the failure rate for short sales is around 70-80%. That means that 70-80% of all homes that originally go on the market as a short sale DO NOT CLOSE. And that means that they either go into foreclosure or the homeowner takes it off the market and has to keep it.
Anyway, back to topic of this blog post.
The CDPE has their trained agents using the above form that has more than 1 questionable item on it. For this post I would like to focus on Item #2.
Item 2 States the following. “The seller will receive no cash from this transaction (unless it is a HAFA short sale). Any funds usually due to the seller will be paid to the lender.
This is inaccurate. Just a week or two ago I wrote a post entitled Boise, Idaho Homeowner Receives $13,000 Selling Their Home As A Short Sale. I have been able to obtain cash for sellers on more than just HAFA short sales and have the approval letters to reflect it. If your agent is using this form do they know that they MAY be able to negotiate a Seller Incentive paid to you upon closing?
As a Seller you need to know you have a competent agent working for you. You are not guaranteed to recover any money from a short sale as a seller but if you could why wouldn’t you want help with moving expenses, rent at your new place, etc.?
If you as a buyer see a form that has this specific wording on it included in your contract be careful and ask the agent why they are including that form with that verbiage. Make sure that your agent can find out the success ratio of the listing agent who is negotiation the short sale or you may be in for a wild ride.
Call me, John Boles, if you are considering buying or selling a short sale in the Boise area - 208.830.6185
Managing Broker, Jon Gosche Real Estate, LLC
REALTOR®, CRS, ePRO, SFR, GRI
Owner/Editor, Boles Editing & Proofreading
John Boles / 208.830.6185 / firstname.lastname@example.org
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Kasey Boles / 208.830.6186 / firstname.lastname@example.org
Boise, Idaho Real Estate
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