They did indeed get the auction postponed this week- with no offers pending except ours which the owner did not sign off on.
They had the one other offer which was 25,000 above ours and the bank countered- people walked.
They did not reject our offer, but have been sitting on it hoping for a higher offer or the auction stay.
I guess since they are not legally bound to disclose the hidden issues they may well get a higher offer if someone does not do the research.
It is finally priced decently maybe only slightly high if one does not know that the permit issues will run 15,000 on the low side to as high as 35,000 without the repairs and finishing the addition.

Although I understand the listing agent trying to get the best sale for her client- I am appauled at the ethics and tactics being used. When their sales keep falling through either due to a lack of financing or the buyer finding out about the hidden issues then my nasty side is going to be smiling. Sorry- I'm human...

This home is in a small city(aprox 80,000) where the forclosure rate is astoronomical- the unemployment is over 20% and the real estate market is 30% second homes. It is on the high risk list for banks and Jumbo loans are pretty non-existant. Right now at their price a basic bid would have to most likely have 180,000 in cash for the 20% and required repairs for the bank-- not including if the permits are discovered...
Not saying it can't be done- but a limited pool of buyers in an extremely distressed market with lots to choose from.

I won't dispute the other agent answers that an auction can be postponed as long as an offer has been submitted. However, I have never seen it. I have seen the auction go forward even though there was an offer presented. I have had 60+ bank owned homes listed this year alone. A good number of them had offers in yet the foreclosure went through and I got the listing. Then I got to re-submit the offer once listed. So I stand by my evaluation that the property will, most likely, go to auction.

I also have to disagree with Gary. You can get an auction postponed within days of auction if you have a sufficient buyer. The auction being one month away is not a cause for concern. The fact that you have an offer way low of appraisal is. Thats a more difficult challenge.

Hello Dennis,
I have listed many homes within a month of going to auction. If the offer gets presented to the bank properly they have always extended the Auction and completed the Short Sale. Good Luck

http://www.WilliamSquires.com http://www.ShortSaleRealtorIL.com http://www.ForeclosureIL.com http://www.ILHomeRebate.com

There is no way a short sale is going to be approved and closed within a month or so. This property is going to auction, no doubt about it. That is probably why the listing agent didn't bother submitting your documentation. He is about to lose this listing. Frankly, it doesn't sound like a property worth spending much time on. He basically has an unsaleable listing. The bank that would have to approve the short sale will most likely reject your low offer, no matter how justified, hoping to get a higher, likely cash offer at auction from a buyer unaware of the issues you discovered.

My advise, don't focus on the issues you discovered and whether another buyer finds out about them. The listing agent now has knowledge of defects and must disclose them. Focus instead on the auction. Serious buyers will likely discover the same things you did and bid low. Your best bet to get the house is at the auction.

Good luck.

If the current appraisal is way past your offer, you're highly unlikely to get them to reconsider now. The agent is a fool to not have shared permit issues with the appraiser because now it's too high.
She's not helping anyone here, least of all her seller.
Probably not much you can do though. Maybe if you become their last hope she'll do it. Or maybe when the house forecloses you can just buy it as an REO.

Hi Minna,
My guess would be that the listing agent does not want to be forced to disclose the extent of the unseen issues. She does represent the seller and her objective would be to get the highest price. A new appraisal was just done for the bank however my understanding is that the permit issues were not disclosed.

I would think that with 2 weeks left before her listing goes off and 3 weeks until the auction that it would behoove her to try and push this offer through for her commision as well as the homeowner.
I was under the impression that it saves banks money not to go through with the auction? In the market I am working in 90% of the banks are forced to buy back the properties as the loans are double what the properties are now worth. No one will bid on these........
I would think mers has enough issues without holding onto shadow inventories.

I am not sure why the listing agent would be against sending this info to the bank, unless she does not want to disclose to all future buyers the extent of the issues.
However right now the permit issues are not a concern to the bank. Unless a BPO has already been done, I would save that info for the appraiser. The appraiser is in charge of determining value. It is in your best interest to have the appraiser/BPO agent be aware of these issues but it really doesn't do you much good to try to convince the bank of value at this early point.

Brent,
Thank you for your input though you have me confused.
Why would I not want to point out these challenges to the bank?
Although the bank may be aware of the broken windows, roof repairs etc I honestly do not believe they have been informed of the permit issues. 2 outbuildings are only permitted for footings and the addition on the house (not finished yet) is an even bigger permit issue requiring all new engenering and architech plans due to changes by the owner during the process. The listing realtor does not disclose this info to potential buyers- when we questioned her she said their are some slight permit issues -- slight my arse.
Our bid was carefully documented as to why the reduction on asking price.
Does the bank really want to deal with these permit issues after foreclosure? If it is put back on the market I would think legally these issues would either need full disclosure or may indeed come up at closing even if listed as is. I honestly do not feel the debth of these issues has even been brought to the banks attention.

What is the delema? You did your homework and made a bid based on these issues. If the other guy did not do his homework yet and he wins, he will have more time during the attorney review/inspection to do that homework and then have the opportunity to get out of the deal. If he doe no tdo his hoework he might be upset, but who cares. The bank got more money from the other guy. That is all they care about.
This happens all the time. Some people do homework and others do not.

philip

Agents are to present all offers irregardless if it's a lower bid. You shouldn't make notice to the deficiencies on the property. Just come in with a bid.

Brent Wilk
Niego Real Estate http://www.brentwilk.com