I read a comment today by a Realtor that really shows a true lack of knowledge about the business of buying and selling short sales.
This Realtor supposedly has a booming business and has allegedly negotiated over 500 short sales. While that may be the case, it really makes me wonder. You see here was her comment.
“I think that the investor short sale is dying a quick death. Banks just do not want anything less than retail price for their properties.”
Hmm..oh really? [Watch the video] So just exactly what banks are you talking to? Because we know this not to be true whatsoever, and we have the closing statements to prove it.
However, she may have one point that is correct. Banks aren’t giving away their assets. I mean she’s right. The bankers, being business people, do indeed want the highest possible value to reimburse their investment.
Where the commenter falls flat on her face is comprehending how that value is determined and by whom.
If she knew the answer to these questions she would know why the real estate investor will always be able to make money with distressed properties whether they be REO’s or short sales. You see I haven’t met many Realtors who can stand toe to toe with a bank negotiator and substantiate the value of a property.
Most don’t know anything about the tiered approval process or have any idea what NTO means or what loss severity means and how they impact the actual valuation of a property.
I’m quite sure there are indeed some Realtors out there who understand this. I just haven’t met one yet. All the Realtors I meet shun the idea of the market being in liquidation status. They are afraid of driving down home values in various neighborhoods.
They accept bank counter offers like it’s a game of Red Light Green Light. They don’t understand their adversary. Many don’t even realize that the banks are their adversary.
Otherwise no one would ever ask a bank that proverbial question of ignorance and incompetence … “What price will you take?”. Nor would any agent ever submit multiple contracts to a bank and ask them to accept one. Here’s a hint…you’re not negotiating!
The reason we are so damn aggressive in our negotiations and the reason we twist the bank’s arm until they tap out is because we have a vested interest in the deal. We don’t take on deals unless we can make at least 5 figures and I’m talking that we can do that on deals where the price of the deal is under $10k!
These are the deals that most agents won’t touch and there is absolute gold in the junkers..that’s the key. They don’t think there’s any value and as such their ignorance is your key to unbelievably easy profits.
Want to see what I mean? Check out this video:
Well we run into properties on our short sale deals that no Realtor in their right mind would approach. You see there are tons of properties out there where you can make an absolute killing on. These types of properties require a real effort to determine the value.
Obtaining a value for that pretty 3/2 in the gated subdivision is quite easy..well let me stand corrected…should be quite easy for just about anybody to determine a value upon.
For some reason, these are the types of properties that Realtors gravitate to. So they list that pretty 3/2 short sale for $200,000.00 and the bank approves the short sale at $185,000.00 and everyone walks away happy and the listing agent takes home a check for a whopping $5,500 bucks and tells everyone that she’s a short sale expert.
I have to call Bulls$%t! Seriously this is nonsense. Sure if you want to work 90 days or more for $5 Grand and want to go searching for a buyer who won’t walk…then by all means have at it. But you don’t understand the opportunity that the Short Sale presents.
If you’re actually looking to make money, watch the video above and ask yourself where are these types of deals in your area. Trust me, they are most certainly out there and they are the easiest of pickings.
The owner doesn’t want the property, the bank doesn’t want the property and the listing agent…if there is one…doesn’t know how to make the short sales on these kinds of deals work. In fact, it usually isn’t financially feasible for the agent to even be involved.
Like I said in the video, the agent is only going to make $150.00!! We’re going to pull down somewhere between $20,000.00 and $35,000.00. Which check would you want at closing?
Investors get out there and find some deals. Realtors, you need to learn how to partner with investors to make a ton of money on these junkers. You’re leaving a boatload of money on the table.
So what are you going to go looking at tomorrow!
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LOL! I was a listing agent on a property just like that, including the same red carpet, except mine had thousands of roaches! Of course, I didn’t know what I was doing and didn’t understand why I had over 12 bids on this, I priced it very aggressively. I asked myself, “why are so many people bidding on this crack house?” Now, I know why! Thanks for posting! BTW, I sold that to one of my investor buyers who fixed it up and tried to flip it, but it’s overpriced and still sitting there (with another agent). It was a short sale, where the negotiation was done by a 3rd party, which I do not recommend as I look back. That deal was a tough lesson.
What’s the status on the short sale video course?
Thanks again!
Hi Carmen..I just sent you an email about the course with access info.
Yeah..we love these kinds of deals. I loves me some crackheads and roaches!!
Your investor might have messed up as his exit strategy may have had a flaw. We know landlord buyers who love these deals. We won’t even swing a hammer and we’ll make a bunch of cash. We take it down, do the double closing (legal double closing) and sell it to a cash landlord buyer.
He’ll get easily $1,200 per month on the front house and $800-$900 for each of the rear units. So he’ll have an unbelievably good cash cow with guaranteed rental income. Gotta love Section 8!
If you learn this kind of stuff you’ll make a killing and be way ahead of the competition in your market!