If agents aren’t asking the right questions in a distressed sale scenario, they’re running the risk of managing a campaign which goes unpaid.

More often than people would expect, we’re getting notice from the bank prior to settlement indicating there will be a shortfall between the sale price and the outstanding mortgage. The lending institution is the first creditor, so they will always ensure they’re recoup their risk firstly.

If an agent doesn’t ask the pertinent question of how much is owed on the property prior to being engaged, they could run the risk of losing their commission.

You have to be confident of the sellers’ situation before committing your time.

When the shortfall is considered a smaller deficit (for instance, $20,000-$30,000) there is scope for the seller and their agent to talk to their bank and work out an alternative before having to sell the property as a mortgage in possession.

The major banks have departments which can deal with these situations. Depending on the institution, there may be a hardship team; a credit collections solutions team; or the shortfall voluntary sales and settlement team.

The hardship teams for the four major banks are:

§  Westpac – 1800 067 497
§  Commonwealth Bank – 1300 720 814
§  ANZ – 1800 252 845
§  NAB – 1800 701 599
§  For a comprehensive list of hardship team contacts, click here.

Happy selling.

See also:

Conveyancing: the not so cheap flight

Conveyancing vs solicitors

Rising international interest in Perth