Top 2 Reasons Why A Short Sale Never Closes… and How to Prevent it

Here are my top 2 Reasons Why a Short Sale Never Closes and how to prevent it.

Number 1 Reason:  ” Seller Ambivalence”

Most people want to keep their homes. This is true of most sellers in a Short Sale.

During some stage in the selling process you will  be confronted with what I call ” Seller Ambivalence” . ”

“Seller Ambivalence” is  like  “Buyer Remorse”. Seller Ambivalence and Buyer Remorse is when second thoughts appear after  a commitment to buy or sell has been made.

Seller will do almost anything to sabotage the listing if they are ambivalent.  If you find  your seller  avoiding  your phone calls,  making  it difficult to show, or has  called the lender to negotiate a Loan Modification while doing a Short Sale then you must have a talk with your Seller bccause these are signs of Seller Ambivalence.

This talk with your Seller can prevent Short Sales from not closing.

Number 2 Reason: “Wrong List Price

Critical to any sale today is having the right price to motivate buyers. Short Sales are not immune to this and must be priced right to motivate buyers.

As an agent you must make sure you understand your market, what the BPO price will be for a Lender and understand a buyer is looking to buy a property at a price at or below market value.

The following is an example of a home I think was priced too high, did not sell, and was canceled as a Short Sale Listing.

cancelled Short Sale Subject property:

This house is a 7 Room, 3 Bedroom, 2 Bath  Brick Bi-Level  home.

List Price: $349,900

DOM: 136 Days (Days on Market)

Cancelled Listing

Market Data:

The market data shows  6 homes sold in the area. 3 homes were Short Sales and 2 homes were Bank Foreclosures. The lowest price home sold was $195,000 and the highest price home sold was $272,500. It is my opinion that the List price for this property should have been somewhere in between the low and high price.

Having the correct list price will  prevent Short Sales from never closing.

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