Friday, October 23, 2009

Will Destin Short Sale Lender "Pay" For The Privilege and Make Zero Dollars on Short Sale


This is a first for me. As a short sale listing agent in Destin Florida, I have a parcel of land for sale in a ritzy golf course community. It is in a newer gated neighborhood where building lots used to fetch over $200,000. When I took the short sale listing at $90,000, it seemed realistic. But the lot market near Destin has steadily declined, fluctuating between a 3 and 15 year inventory in the past two years. That means it would take at least three years to sell out all the lots for sale at the current rate of sales. A normal market is six to seven months inventory.

After a year and a continued down market, we eventually lowered the price to $23,000. When I got a contract this week the offer was for $19,000. The most recent comparable sale, a foreclosure, had commanded a whopping $18,000. So the offer was fair.

The problem came after I ordered the HUD settlement statement to provide the short sale lender, Federal Trust Bank. Of course, I had done preliminary title work a year ago, but things had changed, including the price by 75%. Not only were there past due taxes of $12,000, there were thousands of dollars in unpaid homeowner association fees. In fact, the closing costs on the HUD would pay zero to the short sale lender, and would require cash to close of several thousand dollars! You see the closing costs were well over the sale price!

The seller has no money to bring to closing and is in unfortunate circumstances. The buyer will not. The short sale lender probably will not pay for the privilege of allowing the short sale to get not a single dollar.


It's Wendy!
Wendy Rulnick, Broker, Rulnick Realty, Inc.
Call toll-free 1-877-487-9639 or local 850-650-7883 ext 204
Email Wendy: itswendy@rulnickrealty.com

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