Making Partnerships Work Topic at REO Show
It is not a question of when or how. There is an immediate need for dialogue to occur between lenders and Realtors in order to improve the short sale process and close more successful transactions.
That is Michael Swift’s top priority at SourceMedia’s upcoming Best Practices in Short Sales & REO conference Nov. 9-10 at the Westin San Diego. Swift, a real estate broker with J. Rockcliff Realtors in the
San Francisco Bay Area, is hoping to see real change occur as a result of this conference.
“Lenders and Realtors are out for the same goal. We both want to close on properties and we’re both involved in the process. There are a lot of problems that are pretty simply solved,” Swift told Managing REO.
He will be participating in the panel discussion, “Short Sales Success – Real Estate Agents’ Secrets Revealed,” scheduled on Wednesday, Nov. 10, from 1:30 p.m. to 2:15 p.m.
“There will be quite a few Realtors there and many people from the servicing industry. That’s what I’m looking forward to—getting both viewpoints together to share ideas and try to implement these ideas.”
A meeting of the minds is essential, Swift adds. Panelists will answer these crucial questions. How can agents and brokers speed up the process on their side? What do lenders want to see from the Realtors? What do agents and brokers think lenders should do to speed up their process?
This housing cycle has been going on for almost three years now, he said, and lenders and Realtors still haven’t “gotten together to clean it up. “It’s ridiculous. It’s almost like us against them. The lenders blame us and we blame the lenders. Let’s come together and fix these problems once and for all.”
Swift has built solid relationships with folks in short sale departments at numerous banks. “It’s important for them to know you are a good agent and that you know how to do short sales. I have a pretty good reputation built up with Wachovia and Wells. They know how I put packaging together.”
Deposits in escrow are a hot topic, he said. There are a lot of straw buyers in the market today writing multiple offers on multiple properties. Short sale agents are working on these files and often only one of them will close, Swift said.
“We have to make sure the buyers are locked into the transaction to a deposit for at least 60 days allowing that short sale to go through. If it doesn’t go through, then the lender should allow us at least 45 days to resell that to another buyer and not have to start the process all over again. They have already approved the seller, and they approved the property.”
Some lenders already have the necessary information to make a decision. “You get into a vicious non-closing cycle. You have to start from day one all over again. That doesn’t help anybody. It doesn’t help the lender. They keep that loan that’s sitting there nonperforming on their books. Then we have another buyer come in to start all over again and 90 days later that buyer walks too because it’s taking too long.”
The short sale system is failing, Swift stressed.
“If you can see that it’s not working, change it,” he said. “Lenders are very slow to react unfortunately.”
On the other hand, the industry is seeing plenty of lenders who are complaining about the agents.
“There are quite a few agents who don’t know what the hell they are doing. I know that,’ admits Swift.
“It can’t hurt to have one page of instruction from the lender. Short sales are pretty complicated and they could be a lot easier. If these certain things were done in the contract, it would speed the process up. I haven’t seen this happen at all except for a little bit from Chase so far. There are people out there who don’t know how to do a short sale and screw up the process for everybody.”
There numerous classes taking place focused on teaching the basics of short sales, but agents can’t learn how to do them overnight.
“A one-day or two hour class is not going to do it. There are certain things that can be done to speed up the process. If agents don’t know it they are just going to throw in an offer and fog up the system. That’s not what a lending institution or servicer wants. But they give the real estate agents no direction except for 'we need the financials’ and 'we need the bank statements’ but that’s just for the seller.
“They don’t say how a contract should be written to keep that buyer of that property involved,” he added. “They don’t say a lot of things that I automatically do, because I know if I don’t do this, it’s going to be a problem. Most agents don’t.”
Swift, who will be 41 in November, started in real estate when he was 19 and in the beginning all he did was short sales for about four years. He trained an endless array of agents back then in the early nineties.
"My roundtable group with other brokers has done a lot of short sales since the nineties. We have a lot of them throughout the Bay Area. We meet together every month to go over strategy and how to best complete these short sales, depending on the lenders involved as well.”