What is a Certified Distressed Property Expert (CDPE)?

Before we can define what a Certified Distressed Property Expert is, we need to define what a “distressed property” is. A property can become distressed for a variety of reasons, but the most common is a foreclosure. In reality, any situation that has caused a property owner to have difficulty making mortgage payments or even selling the property is said to be in a distressed state. Simply put, any property which has the potential for a foreclosure is termed to be “distressed”.

Now that we have defined a distressed property, what is a Certified Distressed Property Expert (CDPE)? This is not only a designation earned by a licensed Realtor, but it is also an acronym that signals to the public that the person displaying it has gone through extensive training to assist property owners who are in distress; with the goal of helping families avoid foreclosure. This can be done by negotiating mortgage terms, helping to negotiate a refinance or most commonly, by helping the property owner get out from under the financial burden by selling the property.

Oftentimes these properties have lost significant value as a result of physical damage, area foreclosures or other factors that center around the housing and economic crisis. If the value of the property – less the costs of selling the property – falls below what the homeowner owes the mortgage company, the property is said to be “short”. If the homeowner does not have the cash to cover this shortage at closing, then the property could still close providing the mortgage company, or companies, are willing to negotiate a “Short Sale”. Short sale scenarios have become quite common today, but successful negotiations to close them have not. In fact, only 20% of the short sales submitted to lenders for approval (by Realtors) actually close, while those submitted by a CDPE close over 80% of the time!

Short sale transactions are very time-consuming and challenging. They require extensive up-front preparation with the seller, myriads of paperwork, detailed analysis, diligent follow-up and effective negotiation. The goal is to present the lender(s) with factual market valuation data of a property and to convince them to accept less money than what is owed them due to a personal hardship that is being experienced by the homeowner. Not only does the lender need to be persuaded, but so does the investor that invested in the mortgage note. A great real estate agent familiar with only sales and marketing, but not short sale transactions, is not likely to close a short sale on behalf of a homeowner seeking mortgage relief and avoidance of foreclosure.

The negotiations with the lender(s) and investor(s) to close a short sale do not begin until after the buyer is found and purchase agreement signed for the property. In addition, skill and effective communication is required by the Realtor to keep the transaction together during these negotiations, as buyers get frustrated waiting for the lender(s) and/or investor(s) to provide a response to their offer on the property.

With numerous negotiations taking place simultaneously, it is easy to understand why so few short sales actually close. Today, less than 1% of Realtors nationwide have the CDPE training, skill and knowledge to successfully negotiate a short sale. In fact, as of March 1, 2009, only 2000 Realtors out of 1.1 million had obtained the CDPE certification to enhance their ability to successfully negotiate and close a short sale. I am proud to say, “I have that skill. I am a Certified Distressed Property Expert – CDPE.”

Well over half the homes sold today are “distressed”. If you are facing a financial challenge with respect to your home and mortgage, please understand that you are not alone. This is a national crisis. There are options and there are solutions. Time is typically of the essence, so I invite you to contact me today to determine if I can help you.

If you or someone you know is considering purchasing a home today, consider purchasing a short sale property. Short sales represent some of the best values in the marketplace, and who best to negotiate a short sale transaction but a professional CDPE.