East Valley Real Estate Services, Az – United Brokers Group

What is a Short Sale?

Take a look at our newest Short Sale inventory! A short-sale occurs when the borrower (seller) owes more on the mortgage than the home will sell for based on current market value. When the home is sold the mortgage holder (bank) gets less on the pay-off than the mortgage amount, therefore the pay-off is “short.”

Due to the steep decrease in property values in the Arizona real estate market over the past few years, most borrowers who originated a mortgage since 2005 owe more on their property than it will bring in today’s market. Thus, a large percentage of real estate sales in Arizona, especially the Phoenix market, are short-sales.

Generally speaking, there is no cost to the seller in a short-sale transaction. * The bank pays the costs of selling the home, including real estate commission fees, closing costs for the seller and up to 3% of the sales price in

incentives if the buyer and seller agree to that in the purchase contract. What the bank will not pay for are upgrades, repairs, or replacements, such as flooring and paint. Short-sales are generally sold “AS-IS.”

In most cases the bank will require that the seller have a legitimate “hardship” in order to approve the short-sale. Legitimate hardships include such things as; the inability to continue to make the house payment due to job loss or a significant cut in earnings, medical problems, death of a spouse,  or a job transfer out of town/state, to name a few. In addition to having a true hardship, the bank will require that the seller provide a “Hardship Statement,” a letter explaining your situation in detail, in addition to financial documents, including bank statements, taxes, income, etc… The process is time consuming and requires the commitment of the seller, as well as the REALTOR® working on your behalf.

The time it takes to bring your short-sale transaction to a successful closing is hard to predict, as it depends on the bank’s processes, your timeliness in getting the bank the documents they need and how long it takes to get a purchase contract on your home. This is where having an experienced short-sale real estate agent makes a huge difference! It is a good idea to ensure that your agent has had many successful short-sale transactions. Ask what their experience is with the bank you have your mortgage with. Ask agents you interview what kinds of special training they have had and if they have designations specific to short-sales. This does not make them “experts,” however, experience speaks for itself.

You can obtain important information and warnings about short-sale scams by going to the website of the Arizona Department of Real Estate (ADRE) and obtaining the Seller Short-Sale Advisory. ADRE cautions against paying anyone an upfront fee to negotiate your short-sale. This is a service you receive from your REALTOR® or you may elect to have an attorney negotiate on your behalf. Either way, all sellers should seek legal guidance before entering into an agreement to negotiate or sell their home as a short-sale. Short-sale is not always your best option, a decision a qualified attorney will help you determine.

At UNITED BROKERS GROUP we have many qualified short-sale agents who can assist you if you decide that a short-sale is your best option. Please call us at 480-539-4775 to get more information about short-selling your home.

Bank Owned Homes

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Visit the Bank Owned Homes listed in your area! Bank owned homes, sometimes referred to as “REO” (real estate owned by the bank) are homes that were foreclosed on and did not sell at the foreclosure auction. The reason they did not sell may be that the bank did not receive the minimum bid they were expecting or there was just no bidder looking for that property type that day, the reasons vary. Consequently, these homes were retained by the bank and are now being sold by a REALTOR®.

REO homes are almost always sold “AS-IS.” The bank generally will not make repairs. Many need minor repairs and some need extensive repairs. Condition should always be an important consideration. An aggressively priced home is not always a bargain if the repairs are too costly.  A professional home inspection will help you determine what repairs, if any, are needed. That being said, bank owned homes can represent some of the best buys in the market.

When you buy a bank owned home, in most cases, you will have to sign a “Bank Addendum.” This Addendum represents the terms the bank is requiring in order for you to buy their REO property. It is imperative that you fully understand your Bank Addendum, as it often reduces the rights you have been afforded in the AAR Arizona Purchase Contract. These reduced rights may include, but are not limited to, a shortened inspection period, a non-refundable earnest deposit, the limiting of your Loan Contingency period, etc…

Because Bank Addendums are legal contracts outside the scope of a agent’s ordinary practice, buyers of bank owned homes are highly encouraged to have an competent real estate attorney review the Bank Addendum before they sign it.  A REALTOR® is not permitted to interpret this document for you.

Also, the buyer may be asked to do certain things that are not ordinary in a traditional purchase. For example, the buyer may be asked to have utilities turned on in their name in order to facilitate inspections.

For many of the reasons discussed here and others, it is important to have an experienced REO agent. Bank owned homes are a specialty area and you will want to work with a REALTOR® who understands this process.

At UNITED BROKERS GROUP (UBG) we have sold hundreds of REO properties, representing both buyers and sellers (banks).  UBG has highly qualified agents who specialize in REO transactions and who can help to make the process a smooth one.

For more information about our REO agents or to get more details on bank owned homes, please call us 480-539-4775.

Heidi Quigley
Designated Broker