Short Sales - know when to hold 'em and when to fold 'em

Short sales are can be difficult and time consuming and that's when they go well. While some banks have gotten better some are worse than ever. In my area short sales have become such a prevalent part of our market you really have two choices, work them, or go find something to do besides real estate.

That being said, you can quickly ramp up to capacity working short sales. Once you've reached that point, you really need to start qualifying your short sale clients so you're not stuck with a bunch of listings with little chance of them going anywhere.

This is especially tough for me because I want to help everyone. Here are some guidelines that have helped me:

1. Probably most important is having a seller who really wants help. You can't help someone who won't help themselves. An unresponsive seller can drag out the process and almost guarantee you won't be able to get everything the bank needs for them to make a decision.

2. If there are two or more lien holders from different lenders, you're going to have your work cut out for you. 2nd lien holders can kill your deal faster than you can say "what happened?" It's not to say it can't be done but playing middle man between lien holders is extremely time consuming.

3. PMI companies can also be deal killers. More and more PMI companies are getting in the way. The servicer will often go to the PMI company for approval and you're at their mercy.

4. The condition of the home. If you've got a home in disrepair and a seller not willing to clean it up, you might not want to bother. There's just too much competition in short sales. The large amount of short sale inventory allows buyers to simply move on to the next one.

5. Time is not on your side. If a seller has waited too long it's doubtful you're going to have enough time to market the home and generate an offer. You may be able to talk some lenders into postponing the foreclosure/auction date but most won't budge until you submit an offer.