Remembering how quickly the housing boom went bust for residential building developers such as Sales in late 2007 remains painful.
"I lost more money than I thought I'd make in my life almost overnight," Sales said. "Lots, houses, everything suddenly became worth 50 cents on the dollar."
The loans on the property did not depreciate, though. Sales couldn't sell the homes and lots for what he owed on the mortgages. He became a distressed property owner, someone behind on or unable to pay his mortgage.
He eventually lost all those lots and homes to foreclosure.
The experience might have run others out of the real estate business. Not Sales. His ordeal inspired him to want to help others in similar situations.
Last October, he earned his Certified Distressed Property Expert (CDPE) designation and started a foreclosure avoidance education Web site, savannahbankforeclosures.com.
One of four CDPEs in Savannah - and one of only two with advanced training - Sales' focus is in aiding distressed homeowners.
"The best counselors for drug abusers or alcoholics are often those who have overcome those addictions themselves," Sales said. "I'm the foreclosure equivalent. I can empathize with the situation."
Coaxing distressed homeowners to see Sales, an agent with Seabolt Brokers/Harry Norman Realtors, his Web site or other CDPEs for help is the challenge. Close to 6 percent of Savannah-area homeowners are at least 90 days delinquent on their mortgage payments, according to real estate research firm First American CoreLogic.
Notices of foreclosures were issued on 3,212 properties in Chatham County in 2009, or 267 a month, with approximately 1,200 of those being auctioned off or taken over by the lender.
"It's a big deal, and there are so many people out there who want help," says Helen Miltiades, the other Savannah-area Realtor with an advanced CDPE designation. "If more distressed homeowners were to seek help before their home is foreclosed on, it could really help stem the tide."
Statistics from the Distressed Property Institute, which offers the CDPE training, back up Miltiades' claim. Seventy percent of homeowners in the foreclosure process neglect to consult real estate professionals about their situation, the group said. But of the 30 percent who do, 80 percent avoid foreclosure.
Few of those remain in their homes, however. The Distressed Property Institute's "foreclosure solutions" include getting the mortgage reinstated, modified or refinanced. But in most cases, the distressed homeowners avoid foreclosure through what's known as a short sale.
A short sale happens when a buyer offers a distressed homeowner a purchase price that is less than what he owes on the mortgage and the loan holder accepts that offer as payment on the mortgage. For example, if a buyer offers $120,000 for a home owned by a distressed homeowner who owes $130,000 on a mortgage, the loan holder would have to agree to accept the loss (which would be more than $10,000, because of commission and closing costs).
"With a short sale, you're not listing the house as much as the individual," Sales said. "You have to show the bank the distressed homeowner has no assets, and you have to demonstrate that the loss will be less than if the lender were to take the house in foreclosure and sell it themselves. It requires a lot of paperwork and a lot of expertise."
Short sales are where Sales and his fellow CDPEs turn their work into money. Yet Sales and Miltiades said they would prefer distressed homeowners qualify for one of the other solutions, even though they would miss out on commissions that way.
"The best thing that will help us make a living is to get this whole housing market turned around," Sales said. "Every person we help stay in his house helps stabilize the economy. Once the economy stabilizes, people will be buying real estate.
"And I'll still be selling it."
Almost 6 percent of Savannah-area homeowners are at least 90 days delinquent on their mortgages, according to real estate research firm First American CoreLogic. And the number of foreclosure notices - the initial step in a lender taking over a property - has steadily climbed during the past 18 months, signaling future troubles. Notices must be issued for four consecutive weeks before the lender can take over ownership of the home.
Month Foreclosure notices
July 08 125
Aug. 08 205
Sept. 08 145
Oct. 08 198
Nov. 08 189
Dec. 08 158
Jan. 09 163
Feb. 09 232
March 09 222
April 09 258
May 09 244
June 09 265
July 09 335
Aug. 09 276
Sept. 09 316
Oct. 09 377
Nov. 09 267
Dec. 09 257