There’s a lot of talk about the 100% mortgages out there, major adjustments in existing mortgage interest rates and areas where home prices are falling.  Many homeowners are going to end up in trouble and will need to sell their homes before they end up in foreclosure.

In other situations, you may obtain a listing, and then discover that the price you recommend setting for the home is less than what the seller owes.

One way or another, you may become involved in handling ”short sales”.  A short sale, in simple terms, is a sale where the lender allows the homeowner to sell their home for less than the amount of the mortgage.

If you’re thinking about getting involved in short sales, you’ll need to study the pros and cons in depth.  To get started, you can review NAR’s Field Guide to Short Sales.  That page contains links to a variety of resources that discuss the impact for the homeowner, the buyer, and you as the agent.

In particular the article about succeeding at short sales is a great read.  The article addresses a number of critical issues including the pros and cons, alternatives, how to approach the lender, pricing a short sale home, what compensation you can expect as the selling agent, and the overall long-term impact on the seller.

It’s obvious that short sales are not going to put you in a full-commission situation, and a lot of patience is required.  But, if short sales are becoming a fact of life in your market, these resources will help you determine if and how you will get involved.