Hello Shiv,

Unfortunately, working with short sales can be a long and difficult process. There are many reasons for this. The biggest factor is that each lender handles short sales differently which makes it difficult and sometimes unpredictable for all of the other parties involved. If you are interested in pursuing a short sale property, you need to consider this in your search for your agent. Each agent’s experience is different with short sales. But more and more agents are gaining experience with short sales because there are so many of them on the market right now.

According to the MLS rules, the status for a short sale under contract should be changed to contingent (SS for short sale) within 72 hours of acceptance of a contract. This is not always the reality of the situation. Regardless of this, whether a short sale property has an active or contingent status, you can still submit an offer on the property. Until the lender approves an offer and the property closes, you still have a chance of winning the lenders approval.

Sit down with your agent and draft an offer. Make your offer contingent upon lender approval. Check with your attorney on the best way to do this. I am not an attorney and cannot give legal advice.

It’s your agent’s duty to submit all offers. So you will at least have your offer submitted for consideration. Assuming that you and the seller agree to the terms of the offer (which may be better than any previous offer), have your agent work with the seller’s agent to ensure that your offer gets submitted to the lender immediately. The misconception that the lenders should only have one offer for consideration at a time is part of what slows down the approval process for short sales. Just as any seller would want to see all offers so they can pick the best one, the lender should have all short sale offers for review for the same reason.

I wish you the best in your pursuit of your short sale property.

Have a great day! Vince

Because an offer is being reviewed by the bank, this listing should sow up as "Pending" or "Under Contract". You can but a bid on the house, but it will be a back up offer & will not be submitted unless the current buyer's offer is rejected & he dose not counter or he backs out of the deal. You also have to consider if your offer is next in line or if the banks asks for the highest & best offer. If you decide to put an offer in, also continue looking. The short sale approval can take up to 7 months.

Yes and No. Unfortunately, there hasn't been a lot of consistency in this area. Technically, the Seller has accepted a Buyer's offer contingent upon the bank's approval of the short sale, so yes, they are under contract. I think many (most) agents leave the listing showing active for two reasons. 1) The liklihood of the contract falling through because of the bank not approving the sale. 2) Many times the Buyer's patience runs out waiting for the bank to decide one way or the other and they cancel the contract.

By keeping the listing active, the agent is working in the best interest of the Seller by continuuing to market the property while waiting for bank approval. This, however, causes confusion with the rest of the world.

The way I have written my contracts, If I am in doubt that the bank will accept a Buyer's low offer, I will add an addendum that says that either party may cancel the contract prior to bank approval for any reason. It also states in the addendum that the listing will remain active until bank approval. This way the Buyer is not locked in to waiting on the bank and the Seller is not locked in to the low offer if a higher one comes along.

If you really want the house, I would encourage you to make a backup offer. If the current offer falls through, then you will be next in line for consideration.

Hello Shiv,

The listing should show as being under contract with bank approval needed IF it has already been signed by the seller and submitted to the bank. The bank will review one offer at a time. The first offer in will be evaluated by the bank and accepted, rejected or countered (at least that is the way that I run my short sales). If the first offer is countered that buyer will have the option to accept the bank's counter or submit their own counter offer. Basically, the first offer will have to run its course before your offer will be submitted to the bank. The offer you may or may not make, will be a backup offer and in second position.

If you want to provide the address of the property I can check the MLS status and get back to you.

Be prepared for the short sale process. While you have the opportunity to get a great deal, it is truly a waiting game and you are at the complete mercy of the bank. There is nothing that can be done to speed up the process. It is not uncommon for them to drag on for anywhere from 2-6 months or more.

I hope that helps! Feel free to post any additional questions.

Good Luck!
Chris Clark