No … but then they already know about it so you might as well add bankruptcy and all the rest on the list. Have you asked that question of your potential sellers? My guess is that if they are in or about to enter foreclosure that is the furthest thing from their mind.
It has now become standard practice for most companies to run a credit check on all prospective employees and the worst two marks you can have against your credit are a foreclosure and a bankruptcy. They are the two most damaging marks to have against one’s credit – and they take the longest time to remove. And let’s face it, getting a new job is very often a critical part of rebuilding as it is many times the loss of the previous one is the reason they are facing foreclosure.
As a real estate professional your job is to ensure the client is as well informed as possible to ensure that they are able to make the best decision; taking everything into consideration. Simply walking away from their home under a foreclosure or filing bankruptcy is only going to add to their problems. At the end of the day there may be no other option but what if there was and they didn’t know it existed?
We have all heard so much about the increasing foreclosure numbers that we are becoming a little “hardened” to the subject and try and put the bad news out of our mind. Well, it isn’t getting any better. I made a quick check on RealtyTrac before sitting down to write this article and noted that overall national foreclosures at the end of the second quarter of 2008 were up 121.36% over the same period last year. So far this year they were up 23% in the first quarter and 14% in the second quarter. This past July they were already up 8%.
I even read a recent piece by Octavio Nuiry (RealtyTrac staff writer) in which he indicated it’s not just the subprime folks that are getting hurt. The report noted that seven-figure foreclosures – once a rarity – are starting to pop up with more frequency in some of the wealthiest communities nationwide. Veronica Hearst, the widow of Randolph Hearst, just lost her $22 million Florida mansion to foreclosure. In Orange County California last year 1 out of every 6 condos listed for sale were either a foreclosures or a Short Sale. Today that figure is 1 out of every 4½ condos … no the end isn’t in sight just yet.
We are going to be dealing with these issues for some time to come and it is incumbent upon every real estate professional to be fully conversant with all the various options available in their state to sellers facing foreclosure. As we noted in a previous article, the moment you begin working with a seller that is in trouble you begin walking a “liability line.” So what’s the answer?
Pre-foreclosure and short sales, while not the easiest transactions are a viable option for many sellers teetering on the edge and you need to be able to intelligently discuss that option. If you intend on working in that niche market it is critical that you fully understand the process and can assist your seller by facilitating the transaction for them. Even if the Short-Sale market is not for you, you owe it to the client to help them understand their options and then refer them to a Realtor that specializes in that market. After all, being regarded as a real estate professional today means being more customer-centric in how we handle our business.
Remember … Customer service extended today without compensation is the seed sown for future business. People grasping for an answer to their financial dilemma don’t forget the one that threw them a life ring.
Whether you want to become a Short-Sale expert or just better understand the process I suggest you check out the Certified Short-Sale Specialist (CSP) course from RealtyU. All the details for this great online course can be found by clicking here.
