Foreclosure in Honolulu>Question Details

Lily, Home Buyer in Honolulu, HI

I gave the first offer on a short sale, but another offer that offered more was accepted. Aren't they supposed to work with the first offer

Asked by Lily, Honolulu, HI Mon Apr 25, 2011

first? Is it ethical for a short sale seller to review multiple offers and pick the highest offer, or are they supposed to work with offers in the order that they came in regardless of the offer content?

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Answers

5
Trevor Huntingford’s answer
Both David and Dan are correct in their answers. As an additon in the area I work our addenda in a short sale agreement gives the bank the right to continue to market the property even if the seller has accepted the offer. The bank reserves the right to accept another offer up until such time they approve the short sale.

Bottom line is that short sales are a mess. They are nothing like a traditional transaction and can cause a lot of grief for everyone one envolved. Short sales are a risk vs reward purchase, meaning the risk is you may not make it through the short sale at all after spending long periods of time in escrow with the reward being that if you make it through the short sale you often get a great price.

Keep your chin up and remember that short sales sometimes make no sense to any of us and expect the unexpected.

Regards,

Trevor
2 votes Thank Flag Link Mon Apr 25, 2011
Banks do not play by the rules other play by. For now they can do allmost anything they want to do including crossing the line in many areas such as disclosers, who they work with ect. I have seen full price cash offers with no inspections rejected and bidding wars start. Thats the bad news, now for the good news when you buy a property from the bank you usually get a great deal. The key in working & buying foreclosers is to have an agent who is very good at REO sales and to go after properties knowing that you may have to bid on 10 to get 1. Its not as easy to purchase short sales as regular sales and even when all agree deals still fall apart at the 11th hour. Good Luck
1 vote Thank Flag Link Tue Apr 26, 2011
I have seen more and more banks doing exactly what Trevor is talking about.

There are special addenda that are in there saying that even if your offer WAS accepted and they were going through the short sale process, if another offer comes in, the seller and selling agent are responsible to evaluate that offer and if the offer is better, to accept the offer and submit it to the bank as well.

The seller and seller's agent are protected because all short sales are "subject to lender approval." Accepting two offers is not a problem because the lender will only approve one, but they want to see all of them.

Short sales are a hastle, they are frustrating, they are confusing, they make you want to absolutely pull your hair out (if you have any left).... and they are the new real estate transaction of today unfortunately.

It's more than real estate. It's RAYL-Estate!

Brian Rayl, REALTOR®, e-PRO, SFR
Keller Williams Elite Dallas Park Cities
972-949-4222
Brian@Rayl-Estate.com
http://BrianRayl.com
Web Reference: http://brianrayl.com
1 vote Thank Flag Link Tue Apr 26, 2011
Lily,
David is right that they were not obligated to respond to your offer as long as it wasn't signed, but the listing agent probably should have. It's also true that the best offer on a short sale isn't always the highest. A buyer who is paying cash or has a larger down payment, demonstrates a willingness to wait out the process may have an advantage over another offer.
You may be able to get yours accepted in a backup position, but I would advise you to keep your eyes open for another house.
1 vote Thank Flag Link Mon Apr 25, 2011
As long as seller didn't sign your offer as accepted, out of luck. Short sales are the black hole of real estate.
Nothing makes sense


David Cooper Las Vegaqs Foreclosure Investor In Bank Owned REOs with Cash Flow. email or call for FREE
daily LIST +1-7024997037 not a real estate investor
0 votes Thank Flag Link Mon Apr 25, 2011
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