Southwest Florida Title Insurance & Real Estate Blog

Lately, we have been advised by many lenders’ that you can’t use electronic signatures on short sales.  The major lending institutions really do not like to see electronic signatures.

Despite an announcement in late May of 2012 that Freddie Mac will allow it, the servicers usually frown upon it.

On February 22, 2013 Bank of America recently advised us that they will now accept electronic signatures on most documents collected throughout the processing of short sales; however there are specific requirements that must be met in order for the documents to be accepted.

Real Estate agents choosing to use electronic signatures will need to check with their electronic service provider to ensure the below requirements can be met prior to initiating a short sale.

DocuSign, is one of the providers that has shown they have the capability to meet Bank of America’s security requirements.

The requirements are as follows:
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We have been reviewing recent activity in the home short sale market as we are wont to do and found a couple of surprises.

The most glaring was the number of multiple listing service (MLS) detail that burdened the buyer with paying commission to the listing agent, short sale negotiation fees to a 3rd party, or even the seller’s attorney fees.  Here are some examples of what we found:

• “Buyer agrees to pay listing agent a bonus commission of $2,000 at closing.”
• “Buyer to pay $2,500 at closing to 3rd party short sale negotiators.”
• “Seller’s attorney will attempt to collect a fee of $2,500 from short sale lender at closing.  If lender should refuse to pay any amount of said fee, Buyer shall be responsible for the difference between $2,500 and the amount paid by the lender.”

My first thought was that such detail would discourage buyers from looking at these properties, which would be a reasonable presumption if there were a proven, no-cost, no-obligation-if-it-doesn’t-close short sale solution (which there is of course!) currently in the marketplace.

Curious, I put the question to our database of successful real estate professionals and to a short sale-focused online forum.  Responses were quick but thoughtful.

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First of all, I love the HousingWire news feeds.  If you aren’t subscribed to a RSS feed or aren’t keeping tabs via Twitter, you should.  Check out www.housingwire.com.

This article was posted at HousingWire on Monday by Kerri Panchuk:  ”Survey Shows First-Time Homebuyers Growing Weary of Short Sales”.  In it, the author cites a recent survey that indicates a slide in the percentage of first-time homebuyers who have acquired short sales – from 54.1% in November 2009 to 39.7% in August.  We are all aware of the technical challenges of short sales; but the payoff in dealing with and overcoming those challenges is, according to the report cited, that “short sales . . . generally sell at prices 27% lower than non-distressed properties . . . .”  I got to thinking that if this is true  – that a buyer could expect a 27% discount by buying a short sale – then it would be nuts to “grow weary” of them.  Nuts, unless of course these first-time homebuyers are entering into short sale transactions with poorly set expectations.

Having orchestrated over 700 short sales over the last three years, we understand just how wrong things can go when expectations are not set properly.  So here are a few pointers mostly from a buyer’s agent’s perspective which should go a long way toward helping to manage your buyer’s expectations and toward helping them hang in there to take advantage of the short sale savings.

There is no substitute for good old-fashioned homework and reconnaissance when it comes to making an offer on a short sale.  To wit, you should know or try to find out:

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Congratulations! Your short sale offer was approved!

We want you to know that as a short sale realtor, you’re in good hands with Winged Foot Title. We believe in exceptional service without exception.

As you know, there are three main ingredients to a successful short sale.  They are

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