Welcome to a World of suffering and punishment. That’s the current state of the real estate industry as it relates to short sales – it’s hell out there! In most US cities, “traditional” real estate is all but extinct. The number of short sales and bank-owned/REO listings rose over 10 percent on the Westside of Los Angeles last month alone. More an more homeowners are experiencing some form of financial hardship – job loss, loss of income, divorce, medical problems, adjustable mortgages.

Never ever before in the entire history of real estate have we encountered such uncertainty and such challenges. Homeowners are losing their homes at record pace and we’ve recently witnessed the fall of some of the largest financial institutions in the world. The media is perpetuating the doom and gloom rhetoric that is getting reinforced by nay-saying family, friends and colleagues.

The bank’s REO portfolios are swelling and banks are just not properly staffed. To make matters worse, the employees that are being hired are not properly trained to handle the bombardment of loan modifications and short sale files being submitted.

In the days-of-old, NODs (notice of default) were filed after 90 days of missed payments…like clockwork. Now, many of the banks aren’t filing until eight or nine consecutive months payments are missed. The fact is: rules haven’t just changed – this is an ENTIRELY different game.

As a real estate agent, I understand that a short sale occurs when a lender agrees to accept less than the outstanding loan amount to satisfy the seller’s loan. Done successfully, a short sale allows both the lender and the property owner in distress to avoid the foreclosure by getting the property sold at a loss.

With the current state of things, short sales are expected to be the bulk of real estate transactions in 2010 and for the next couple of years beyond. I believe that I am one of the few Los Angeles real estate agents that is completely effective at navigating the turbulent seas of a short sale.

If you want to read more articles about Los Angeles short sales, click here.

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