The key to setting yourself up for an successful 2011 is to focus on short sale transactions, according to Fitch Ratings. Short Sale transactions equate to a significant principle savings for banks and investors. “Loss Severity” is the term that you will hear a lot in 2011 and, in terms of home financing, essentially means the amount of principle a bank or investor will lose by following through on a certain liquidation process. According to Fitch Ratings, the principle lost (loss severity) by foreclosing on a prime loan is going to be half in 2011. For sub-prime, the picture is much, much more dismal. By foreclosing on a sub-prime-financed home, the investor stands to lose 85% of the principle in 2011. 85%! As a result, more and more banks are going to look more toward short sale as a liquidation strategy in 2011.
As a result, the key to your success in 2011 is going to be to embrace short sale transactions, know that it is going to take 4 to 6 months to get them through the process and closed and then take off running!
To keep from losing your mind, we STRONGLY recommend that you use a 3rd party short sale processing company. Our affiliate, Complete Short Sale Processors is the best around. In most states, where the law allows (California is an exception), they do not charge either agent, the buyer or the seller for their services. (If you are in California, it is still likely that we will not need to charge, but give us a call, so we can discuss.) CSSP will keep you updated every step of the way and no one has a better closing ratio. For more information about CSSP and how they can partner with you to have a successful 2011, contact Steve Pace, Director of Sale with Complete Short Sale Processors at (949) 295-5483. He will walk you through the entire process and get you on the road to a successful 2011!
To access the report from Fitch Ratings, CLICK HERE.