Short Sales 101

August 4, 2010 by Lucas Lechuga

We get a lot of calls from people who are interested in buying a short sale condo but aren’t exactly sure what a short sale is or what the short sale process entails. On yesterday’s show we answer several frequently asked questions regarding short sales and also discuss how a short sale differs from a foreclosure, also known as an REO or real estate owned. At the beginning of the show, we discuss three Miami foreclosure condos that came on the market recently: One Miami #1426, Courvoisier Courts #203 and Solaris at Brickell #1601. This is our longest video to date but a lot of good information is provided.

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105 Comments on "Short Sales 101"


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Anonymous
ElvisInMiami
6 years 1 month ago
It would be good to mention the property tax differences. For example, buying an REO doesn’t mean you pay property taxes on the sale price, you pay property taxes on the price if it was not an REO (as calculated by the county property appraisers office.) Also there are games people (agent/owners) play where they offer a property as a short sale at a low price, but never answer their phone or allow people to view the property. Then they talk to the bank and say the house was on the market at this price for X months (usually 6… Read more »
Anonymous
Poor and Unemployed
6 years 1 month ago

ElvisInMiami

You are so right about it. I can show many properties in Miami. My question to Lucas – Why do the realtors take a listing knowing that the owner has no intention of selling! Do they get retainer fees or something? As we all know that no one in miami is going to help you to make few thousand dollars taxfree without getting something in return! Right?

Sometime, Short sale is a marketing ploy. Buyer keeps bidding against himself with a imaginary loan officer!

Anonymous
Piazza Armerina
6 years 1 month ago
A short sale is when the person doesn’t really want to sell, but is acting like it. He/she says, hell if I can get away with proving to the lender that I’m broke and then getting the lender to accept a lower price than what I paid, they can write it down in their books as a loss, and I can get myself out of a situation where my condo won’t be appreciating any time soon, then I use my funds to buy something that’s a good deal – and try it all over again. Not to mention the imaginary… Read more »
Anonymous
What Do You Think
6 years 1 month ago

Dear Elvis and Poor and Unemployed and Piazza Armerina,
How interesting! I admire your cracking the code and demystifying a short sale. You may potentially have helped a lot of people who may be considering a short sale. Thanks!!

Anonymous
Joe
6 years 1 month ago

There are plenty of stories about people listing short sales and then avoiding potential buyers like the plague. It’s obvious a lot of people are using the process as a de facto cramdown for houses/condos they want to keep, but at a lower price.

Anonymous
Poor and Unemployed
6 years 1 month ago

Question remains – Why do the realtors take the listing? Recently a house came on the market in Downtown Miami area in with asking price of about a million. I had a serious all cash buyer but while it was listed as “drastically reduced”. Listing agent would not even show the property. What can one do? Call NAR?

Anonymous
Wild Bill
6 years 1 month ago

The fake ads (outdated MLS, incorrect MLS listings) drum up phone calls which might eventually lead to a sale. NAR and DBPR know about it. Regulation is bad for the industry.

Anonymous
Joe
6 years 1 month ago

Poor and unemployed — Did you try calling the listing agent’s boss/manager? If that doesn’t work, perhaps you can find out who holds the mortgage and then call the bank directly. As people have said above, short sales are the newest source of widespread fraud in the r.e. business. (In this case, you might not get the house, but you’d at least get the satisfaction of calling some people on their B.S.)

Anonymous
Renter Tom
6 years 1 month ago

Joe — couldn’t agree more. There is SO much fraud around short sales it is amazing. Banks should just offer a low interest rate or let the property be foreclosed upon.

Here is a nice article for floplords:

http://money.cnn.com/2010/07/28/real_estate/renting_out_home.moneymag/index.htm

Enjoy…

Anonymous
JL
6 years 1 month ago

In general, if you see a good shortsale offering from a podunk realtor… it’s usually a scam where the owner is trying to get the property back himself. Welcome to Miami.

Anonymous
Joe
6 years 1 month ago

I just found this funny quote in a story about Michelle Obama’s (absurd and inappropriate) vacation in Spain:

“It has also been an open secret that in the regional capital of Marbella much of that money comes from the seedy-side of life, linked to **speculating in real estate,** or dirtier crimes, such as extortion, contract murders, car-thefts, arms and drugs trafficking and prostitution. It is suspected that much of those ill-gotten gains were sent to offshore accounts.”

(From: http://www.washingtonexaminer.com/opinion/blogs/Examiner-Opinion-Zone/why-did-michelle-obama-choose-seedy-marbella-spain-for-her-vacation-100132144.html)

I love how “speculating in real estate” was tossed into the same sentence as “contract murders” and car thefts. LOL.

Anonymous
Samson
6 years 1 month ago

If somebody thinks Marbella is seedy, they will also think real estate speculation is dirty. The only “seedy” thing in Spain these days is our “First Lady” if you will pardon the expression. How crass, crude, ungainly and untimely her “vacation” (from what?) has been. Running to and fro up and down beautiful cobbled streets all 100 of them go, huffing and puffing, day after day. What are they looking for? And then its off to the Gulf of Mexico…for one day. Then what?

Anonymous
Drew
6 years 1 month ago

Joe
Please explain why you feel the vacation was “absurd and inappropriate.”

Because of unemployment? Oil spill? Health care? Afghanistan?
If she wants to go on vacation, what destination would be “less absurd” or deemed “appropriate?” What should she be doing this summer? Knitting sweaters for the homeless?

This is just like the auto execs flying to DC, Tony Hayward at a yacht race, Wall Street bonuses, Obama playing golf, etc. Give me a break with the Populist Revolt schtick. Its pretty simple : class envy.

Anonymous
Samson
6 years 1 month ago
Since “Joe” is obviously hard at work so he can pay his bills and estimated taxes this summer like most of us, I’ll answer for him: A vacation is defined as a break from work. Michelle Obama does nothing, her multimillion dollar a year staff of dozens notwithstanding. That’s why her “vacation” is “absurd”. It is “inappropriate” given the terrible economic plight many are suffering worldwide as this foolish woman, her daughter and their entourage run around southern Spain staying in thousand dollar a night hotel rooms, imposing their poorly dressed selves on local dignataries (who could care less about… Read more »
Anonymous
George
6 years 1 month ago

Samson

This foolish woman (as you referred to her) and her husband paid over a million dollars in federal taxes in 2009. How much did you pay? Please put your white sheet back in the closet as your rant has nothing to do with Miami Condo’s

Anonymous
Drew
6 years 1 month ago
Samson must be an angry unemployed Tea Party member. Or Rush Limbaugh. So a “vacation” is absurd since she doesn’t work? Ok, call it a “trip.” Does that lessen the level of absurdity? What’s absurd is that, according to your logic, non-working people aren’t allowed to take vacations, since by definition, a vacation presupposes employment. Sure, buddy. And is it really that shocking or appalling that the First Lady stays in an expensive hotel? Would it be better if she lodged at a youth hostel, to, ya know, demonstrate that she is aware of “the terrible economic plight many are… Read more »
Anonymous
Renter Tom
6 years 1 month ago
You guys are silly… if it was GW Bush & wife going on all the outings (broadway night out, mother-in-law taking a free ride at the WH and travels, vacation after vacation after vacation, going on The View, hooping it up with celebs, etc.) you’d ALL OVER the guy on just one of these. The simple answer is Obama has no experience leading anything and it shows…a lot of lip service to jobs and the economy but all they have done is a huge political power grab with a sharp left turn to socialism that will haunt our country’s economic… Read more »
Anonymous
Makes Me Think
6 years 1 month ago
Maybe if you read the fact first you might make an informed opinion. She is a black woman in the white house, she has had a long honeymoon since she became first lady. I expected the natives to turn on her much sooner, I guess she should be thankful that she has had 18 months without the savages on her back. http://www.suntimes.com/news/sweet/2578614,CST-NWS-sweet09.article. she went with her good friend who was dealing with loss of her father they paid for their vacations, The secrete service picked the hotel for security reasons there were no large entourage as reported by media and… Read more »
Anonymous
lara
6 years 1 month ago
I have only one problem with her vacation. BTW the South of Spain is really very beautiful . a lot of history and fun. One can stay on the sea and every day go to GRanada, Seville, Mikhas, Gibraltar, and many many other places. Really great place to have a vacation. I would recommend everyone to go there. It is not that expensive. All you need is a hotel and a rented car. A couple of words in Spanish would not hurt. As I mentioned one problem with her vacation is that her security is being paid by the government.… Read more »
Anonymous
Makes Me Think
6 years 1 month ago
Another think about this vacation. I guess Osama bin-Laden, Al-Qaeda and the Radical Muslims of the world must be busy thanking Allah because it must be rather apparent that the destruction of the most powerful country in the world is imminent. Why else would the citizens of what was once the most powerful country in history be so panicked about the first lady spending 5 days in a luxury hotel in Spain. They have changed the way we live our life and now we are bitching and crying about the the amount of money the first lady spend on a… Read more »
Anonymous
Makes Me Think
6 years 1 month ago
Lara, she has round the clock security wherever she goes. If she goes to LA the security is the same, the flight is just as long. She doesn’t have a choice or a say in the security detail. Would you rather she pay for private security and end up getting assassinated? As far as vacation goes, George Bush stayed on vacation that was one of the main criticism of him. He was always at his ranch even when shit was going on. Again if you don’t like it then go about changing the system. We need to make cuts so… Read more »
Anonymous
Makes Me Think
6 years 1 month ago
RT- Change and political power grabs are NOT the things we needed…we needed certainty and prudence instead. Hate to break it to you RT but Change is what he ran on and Change is what I voted for. I am actually surprised he has accomplished as much as he has, I just wish he wouldn’t be so accommodating to the damn conservatives. I wanted Hillary because I know she is a bitch with a killer attitude, Obama is too soft, he has no killer instinct. One thing I admired about the bush administration is that they ruled like they were… Read more »
Anonymous
Renter Tom
6 years 1 month ago
Makes Me Think – You have NO IDEA what you are talking about. The U.S. Secret Service detail that goes on foreign trips is larger in a foreign country and the trip is far far far more expensive then if she traveled to LA. By the way, she is NOT required to have a USSS detail. Any protectee is free to waive it. And, the only travel expense they pay for is what a market rate air fare would be…but they take an air force jet at > 100x’s the cost. There is no need for her to take this… Read more »
Anonymous
Renter Tom
6 years 1 month ago

Recent headline on cnn.com

“U.S. House of Representatives passes a $26 billion measure to help avoid teacher and U.S. House of Representatives passes a $26 billion measure to help avoid teacher and emergency-responder layoffs. layoffs.”

State bailouts… What a bunch of BS. All the money goes to the states…it is NOT really targeted for just teacher and “emergency-responders”. That is just political cover. Money is fungible and deep cuts need to be made in the states. Another bailout of outdated, socialistic unions. Unions have their place, but the teachers’ union, etc. are dinosaur relics and do nothing to help our country.

Anonymous
Makes Me Think
6 years 1 month ago
RT – The double dip or malaise will be ALL his fault…very poor leadership. Very poor. The decisions being made are just jaw droppingly stupid. That is your opinion and like ass holes we all have one. Your boy GW did such a great job it is no wonder he is considered one of the greatest presidents ever. I guess all the great decision he made about invading Iraq and starting 2 wars costing trillions of dollars and the tax cut he gave to the wealthy costing another trillion dollars plus the no bid prescription drug plan he gave to… Read more »
Anonymous
George
6 years 1 month ago

Makes Me Think #25,

Well said Sir!!

Anonymous
Makes Me Think
6 years 1 month ago
RT -she is NOT required to have a USSS detail. Any protectee is free to waive it. The USSS is REQUIRED by law to provide protection to the president and his family along with a host of others. If she could and did waive security then she would be called a fool and irresponsible considering we are currently fighting 2 wars. Do you even think about the Rubbish you write or does your hate for the first family of this county consume every rational thought you may have had? I used to respect your opinions even though I rarely agreed… Read more »
Anonymous
George
6 years 1 month ago
Protective Operations The Secret Service is world-renowned for the physical protection it provides to the nation’s highest elected leaders and other government officials. To safeguard Secret Service protectees, the agency does not generally discuss the specific types and methods of its security operations. In general, permanent protectees, such as the president and first lady, have details of special agents permanently assigned to them. Temporary protectees, such as candidates and foreign dignitaries, are staffed with special agents on temporary assignment from Secret Service field offices. All current former presidents are entitled to lifetime Secret Service protection. However, as a result of… Read more »
Anonymous
Renter Tom
6 years 1 month ago

Makes Me Think – Show me the law! A colleague was undersecretary of the treasury, enforcement which oversaw USSS so my source is pretty darn good. Any protectee can waive protection…example, former president Nixon waived lifetime protection since he thought it was a waste of taxpayer money.

You are wrong yet again.

Sooooo, U STFU!

Anonymous
Renter Tom
6 years 1 month ago

Moreover, a USSS SAIC also told me the same thing…can be waived.

Anonymous
Renter Tom
6 years 1 month ago

I should further clarify….. the USSS SAIC was part of the presidential protection detail.

Anonymous
swisschesse
6 years 1 month ago

How many times did Oboma go golfing, vacation, and meet sport teams during “the greatest natural disaster in U.S. history” Obam’s word not mine? How long did it take to go to the Gulf to get photo ops? How long is he going to blame Bush for? What has the 100 of billinions done he spent for the unions do? the only thing he has did is quickly CHANGE our country into a Solicalist country! We will see in November what the people WANT!

Anonymous
swisschesse
6 years 1 month ago

How many times did Oboma go golfing, vacation, play basketball, and meet sport teams during “the greatest natural disaster in U.S. history” Obam’s word snot mine? How long did it take to go to the Gulf to get photo ops? How long is he going to blame Bush for? What has the 100 of billions done he spent for the unions do? the only thing he has did is quickly CHANGE our country into a Solicalist country! We will see in November what the people WANT!

Anonymous
DML
6 years 1 month ago

Dear swisscheese:

Obama has every right to blame George Bush for our financial problems for as long as it takes his new administration to heal our country’s awful financial wounds. If you can’t see what Bush did to ruin our economy then you need to get your head out of your cheese hole dude!

Oh and by the way – I lived in a European country for more than one third of my life and, guess what, a little socialism ain’t so bad. Try it, you’ll like!

Anonymous
Joe
6 years 1 month ago
Drew said: “This is just like the auto execs flying to DC, Tony Hayward at a yacht race, Wall Street bonuses, Obama playing golf, etc. Give me a break with the Populist Revolt schtick. Its pretty simple : class envy.” — Ha ha ha ha. Are you kidding me? Barack and Michelle Obama are the freaking KING and QUEEN of class envy. How do you think Obama got elected? —— Makes Me Think said: “One thing I admired about the bush administration is that they ruled like they were on a mission from God and damned be anyone who got… Read more »
Anonymous
Makes Me Think
6 years 1 month ago

Joe Please,
the right wing nuts love Bush.
why else did he invade Iraq when the whole world told him not to. Why did he fabricate evidence against a sovereign nation then declare war on them. Where are the weapons of mass destruction? Bush F-up so bad presidents for the next generation will be blaming him. I know some here would like us to forget about all the damage Bush and his boys caused but we will never forget cause we don’t want to repeat it.

Anonymous
Makes Me Think
6 years 1 month ago

RT, Show me where it says the president and his wife can refuse protection otherwise it doesn’t exist. I’ve heard recently where the president said he would just like to go on a simple walk without his detail but they wouldn’t allow it.

I don’t want to argue silly points with you. My point is that it would be asinine of her to refuse protection and it is asinine of you to even suggest such.

Anonymous
Samson
6 years 1 month ago
Drew: Here, in this country, the word “secret” is spelled just like that: “secret”. “Secrete”, as you have spelled it being either illiterate or from elsewhere, on the other hand, means to hide, to conceal (as in “The photos from the First Lady’s embarrassing trip to Spain were secreted in a vault in Chicago”) or to produce, to discharge (as in “The drool was secreted from the gum being chewed in the First Lady’s mouth as she ran to and fro and up and down and all over in southern Spain looking for what God knows”). Renter Tom: All good… Read more »
Anonymous
Joe
6 years 1 month ago

Makes Me Think — It seems your math skills are as faulty as your other logic around here. There are twice as many self-described conservatives in the U.S. as self-described liberals, yet somehow Bush left office with an approval rating in the 20s or 30s. Please explain how an approval rating in the 20s or 30s could have been possible if “all right-wingers love Bush.”

Anonymous
Drew
6 years 1 month ago

Samson
1. You’re not even remotely funny.
2. Before calling people illiterate, maybe you should learn how to count and read yourself. I didn’t write “secrete” – that was MMT #18.
3. Your empty retort shows you have no ability to provide any intelligent analysis here. Good night.

Anonymous
Samson
6 years 1 month ago

Drew:

You’re absolutely right. My apologies.

Anonymous
Richard
6 years 1 month ago

Not sure USSS is so great based on its past with Kennedy and Reagan

Anonymous
Mike
6 years 1 month ago

Remind me how the First Lady, Secret Service, or Obama are connected to short sales? This comment thread has veered off into uselessness.

What happened to AJ? Finally got foreclosed on? Or perhaps he engineered one of these shady short sales?

Anonymous
Joe
6 years 1 month ago

Mike — AJ has been gone for 6 months or so.

The real question is: Where’s Gixxer 1000? I wonder if, after armchair quarterbacking from afar all year, he finally got a taste of the “real” Miami and ran back north to safety. Ha ha.

Anonymous
RA
6 years 1 month ago

Stick to the topic. If you wanna talk about the Obama’s post on someone elses blog.

Anonymous
Joe
6 years 1 month ago

Well, at least my Obama joke brought this place back to life. There were only about 10 comments in the last week here prior to that.

Anonymous
Gixxer 1000
6 years 1 month ago
I’m still here and actually like it more now that I’m here full time. I’ve been shuffling back and forth between hotels and a friends place in Ft. Lauderdale while looking for a place. I finally decided on a nice 2/2 at 1060 Brickell. I love the building and I love the area. The front of 1060 is right on Brickell ave. and the back leads right into Mary Brickell Village. I’ll probably write a little more detailing my experience when I get more time. I can definitely confirm the momentum is shifting back towards the owners. I offered $50… Read more »
Anonymous
Joe
6 years 1 month ago

Gixxer 1000 — Glad you found a place. Was this a change of plans for you? For some reason, I thought you had a place lined up before you made the move to Miami.

Anonymous
Joe
6 years 1 month ago
Gixxer 1000 — BTW, I don’t doubt that owners are getting a little more aggressive in their pricing, but I’m curious how long it will last. The U.S. economic numbers are just god-awful, and with the huge tax increases going into effect in only 4-plus months, 2011 could be an economic bloodbath. I suppose tax increases could actually make Florida more attractive for people, but at some point, it seems like the Miami job market has to have an effect on housing prices/trends. A true crackdown on immigration also seems like it would be bad for Miami, at least in… Read more »
Anonymous
jcrimes
6 years 1 month ago
i’m no obama supporter…but this argument about michelle’s vacation requires a little levity. bush’s iraq brainfart is at what now? a trillion dollars and how many dead? i’ll take south of spain vacations over a war that led to the death of 4,000+ american kids, fathers, and mothers any day of the week. and let’s be clear on where i stand – i’m a republican at heart. ANYWAY, not to sure that the pendulum is swinging back to owners. rents in brickell may be rising but then that means that rents on the beach/gables etc. are taking a hit. i… Read more »
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