If it is agreed that buyers will wait for bank approval prior to beginning the home inspection, what is the remedy if the inspection reveals problems the buyers do not wish to address and cancel the transaction?What if the loan lock expires or the buyers lose their job? The sellers have then lost up to six weeks of time which moves them closer to foreclosure and desperation.This is a new market. Few are equipped to deal with its variables and sticking points. Zillow is not; REALTORS(r) are.According to Zillow.com, my own home has appreciated a whopping 22% over the last two years. Do you honestly think that’s correct? I would be foolish to believe that. Zillow doesn’t live here!If you are a seller and you aren’t feeling secure about the advice being given to you, consult with an attorney who understands real estate or involve your agent’s broker to be sure your path is sound.Relying on the asking price of every comparable property is risky unless you know the details. Only your REALTOR(r) knows for sure. Matt Cooper is a REALTOR(r) with CENTURY 21 Buena Vista and can be reached at 805.407.4671; www.mattcoopersells.com
Zillow Doesn’t Live Here!
January 04, 2008
REALTOR® Outlook
Columnist
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By Matt Cooper
REALTOR®The traditional method of pricing a home for market is to review the pricing of recent closings, pendings of comparable properties.The new, non-traditional method is to search the Internet for value sourcing, as though any home is exactly like any other.Shaping the value of any home is its proximity to a brown field, a railroad track, schools, condition of the pool, quality of the landscaping, age of the roof, size of bedrooms, and the number of upgrades-things about which Zillow does not know. It has also been appropriate to look at properties currently on the market, but it’s now essential to know if these homes are subject to “short pays”.In today’s market, sales in the last 60-90 days are more appropriate comparables as prices are changing so rapidly.Agents not skilled in short sales are apt to put inordinately low prices on new listings just to solicit an offer with the hopes the bank will accept any offer, rather than foreclose.Banks are not approving short sales just because there is an offer on the property and the sellers have stopped making payments.Banks look at the borrower’s entire financial and personal situation. They want to know why the borrower is not making their payments. What is the appraised value of the home? What is the borrower’s income? How did they buy the home? Is it their principal residence? Finally, they will look at the costs attached to the sale and decide whether or not to pay them, including the amount of the brokerage fee.The short sale process is frustrating and very time consuming. In dealing with the Work-Out Department, be prepared to talk to numerous people about the same topic, fax the same documents multiple times, return phone calls to voice mail and wait. Now that Congress has eliminated the tax liability for sellers who receive mortgage debt relief, the inventory of homes for sale is likely to increase.If a buyer decides to make an offer on a short sale property, strategies need to be addressed upon acceptance. Should the buyer initiate their home inspection and appraisal within the terms of the contract, or should they wait for the approval of the bank?
