The bank may be able to just back out. This depends on what kind of approval they give your offer. Most likely they have the ability to do this. But, if you are qualified to buy and your offer is in line with their estimates of what the property should bring, I don't see why they would do that. If you have only been negotiating with the bank for a month it would be wise for you to expect to wait still longer. It is not uncommon for buyers of short sales to have to wait for six months and even more to close a sale that is dependent on the approval of the mortgage holder.

The worst case scenerio is that the bank will drag things out, not answer and go ahead with the foreclosure. If that happens it could force you to deal with a new listing agent after they process the home and put it back on the market . That could take a lot of time.

Sadly, short sales favor investors with cash who can sit and wait - not families who need a home.

Hi Largo,

Did you attach a FAR Short Sale addendum to your offer? It is a very important part of the offer process in Florida. It spells out how much time you are willing to give the lender to come back with a final decision. The default is 45 days. Based on what's happening in Orlando 45 days is plenty of time. If a bank takes more than 45 days then you usually know one of two things - either the listing agent or the bank is less than fully compentent on short sales.

Only about 25% of short sales EVER close and on the ones that do the decision gets made in less than 45 days more then half the time. Your realtor should have made it clear to you how low the odds of a successful offer actually are. If it goes past 45 days, then demand a very good reason IN WRITING as to why. If you don't get one, walk away.

Good luck to you,
Mark

Largo Di,

The month's almost over and maybe you have heard something from the Seller's Lender by now. When you asked about protection refer back to the amendments you got from the Seller's Lender when they agreed to the price and closing date. It should address some of your questions. Are you referring to the closing date you and the Seller agreed to or the lender actually gave you one? I have never had a firm date on a short sale from the lender. On some bank owned properties, the bank will give a firm date it must close by, or they charge the Buyer per diem.

In Short Sales and Bank owned properties, the lender's addendums (add ons before you are ratified) or amendments (add on conditions after you are ratified-as in your case- you and the seller already had a signed contract) favor the lender almost if not 100%. The guidelines in the amendment take precedence over anything in the original contract. Usually it says something to the effect that the lender will not be responsible for delays in closing and it may even say they have the right to withdraw their approval. Every lender is different. We have even had different experiences from the same lender. If you are getting close to giving your notice to your landlord, you might want to explore a month to month option if he/she is willing.

The fact that the lender did give you an approval is a positive indicator. It may be that they are having title issues, in which case you definitely want it resolved before you take title. Make sure your realtor is checking regularly with the listing agent for updates. Good luck!

Pam Cohn
Broker Associate, GRI, CDM
Prudential Tropical Realty
727-204-7155
pcohn@prutropical.com

Largo Di, I do not envy you, if you are trying to deal with Deutche Bank. Some good news, however, is that last year I did successfully close a short sale listing on one of their loans, serviced by Saxon--do you know who the servicer is?
DeutcheBank is one of the most renowned lenders in the arena of bad loans--they try to foreclose as often as accept short sales, because the lenders are protected by insurance which covers these losses.

However, even banks must follow the same contractual obligations as everyone else--if they have signed off on a contract then you, as the buyer, have the right to sue for performance of contract. Ask your Realtor (hopefully you are using one), and if your Realtor does not know, he/she can inquire on the legal hotline provided by the FAR.

Good luck--don't give up, and read every single thing you have signed or that the bank has sent--most likely they sent an addendum to the contract when it was agreed upon (assuming you have a fully ratified contract which was approved by the lender). Keep in mind that the terms will be theirs, not yours--just because you have asked for a specific closing date in your contract does not mean that the bank will agree.

Lorgo Di,
As you have read, each bank or processor has their own set of rules. We as real estate agents can share experiences where responses from the same bank appear to be from a completely different set of rules. You as the buyer, have little influence on timing or outcome. Welcome to the world of short sales, the wild, wild west of real estate. As you have identified, you need to be aware you can end up homeless if you don't have the budget to support some redundancy in your housing arrangements. This is where the value in representation by experienced short sale specialist prove to be crucial.
Best of luck with a timely closing on your new home.
-
BTW, getting a reponse from the bank in four weeks is very good!

Just make sure that you get the approval of the contract by the Lender in WRITING.Usually,if they put it in writing that they agree to the purchase price ,the terms of the contract ,the HUD statement ,and they set the closing date,you should be good to go.However,I have not been involved in transaction with Deutsche Bank so hopefully someone out there will have better answer.

Hi Largo,

It's a good idea to hear what's happening with other deals out there, but every deal is different so try not to worry too much about if this or that's. All you can do is handle your deal the best way possible if you really want the house. Once you get a bank approval letter, that will tell you how many days you have to close. I personal have not dealt with a Deutshe Bank or have heard of their dealings. Good luck with your deal, though.