About Short Sales

Hawaii has always been known as a tropical island paradise, a dream vacation, with it’s perfect weather, white, sandy beaches and warm, loving people. But what about our real estate market? As those of us who live here know, the late 80’s were an interesting time. Suitcases of money, hand-delivered by Japanese business men, smelling deals.

All of a sudden, all that glitters was gold in Hawaii…..Homes were purchased as regularly as sipping water. Loans were made to anyone who could fog a mirror. Home owners were stripping the equity out of their homes just for the heck of it and spending it on fruitless items and activities.

Much like the waves that coming crashing on our shore, so did our real estate market. Now the tide is sucking back out to sea. Home owners are baffled on how to sell their property in this economy. People that actually want to buy Hawaii property can barely qualify to get a standard loan, if at all. Most Hawaii home owners owe more on their mortgage than their property is worth, or at least, have no equity left in their property in this market.

The real question is, what is the best way to sell our Hawaii house in the current market, with a Realtor right? The answer is usually NO. 99% of Hawaii Realtors lack the creativity to get the job done right. Most are one dimensional thinkers and are not interested in the home owners best interest. Most just list a property and continue to tell the home owner to keep dropping the price hoping it sells.

Several Hawaii home owners actually are over leveraged. This means, they owe more on their mortgage than the house is currently worth in our market. The only way to sell a property in this situation is to pay the mortgage company extra money just to sell the house to a new buyer at an already discounted price. Stupid, right?

In this economy, even the banks, as we have seen in the news, are feeling the effects of the recession. Since several Hawaii home owners are in difficult situations, they are asking the banks to accept a short sale. This is where the bank will take a payoff of less than what is currently owed on the mortgage.

If no offer comes in on their property and the home owner has only one loan in place, they may wish to consider a deed in lieu of foreclosure. Be warned that both of these exit strategies will affect their personal credit to a degree. Also, they will need to consult with a professional that has at least 7-10 years experience in this field rather than some wanna-be investor hoping to make a quick buck.

There is no better exit strategy for Hawaii home owners right now that to offer owner financing to new buyers. Again, you will want to consult a local Hawaii professional, that has experience with this, so that you do it right the first time and avoid legal issues down the road.

For example, a mortgage take over program might be an option. This is where a new buyer can come in and actually begin making the monthly mortgage payments. This would immediately alleviate the pressure from the home owner and slide a new buyer into the property at the same time, thus creating a win-win situation. Again, please consult a professional company like IBuyHousesHawaii.com before making any decisions.

All of America, including our Aloha State has been rocked by the current economy. If you need to sell your property and you do not want to wait 6-months to get it done by repeatedly dropping the sales price. In many situations using a Realtor is counter productive to actually selling the house and will get the home owner in more financial difficulty than before. This actually happened to me with a large national company with offices here in Hawaii. Never again.