Home Buying in Denver>Question Details

dolce902, Home Buyer in Denver, CO

After a seller has accepted an offer on a short sell can they increase the listing price before submitting the offer to the bank for approval?

Asked by dolce902, Denver, CO Tue Apr 3, 2012

I recently put an offer on a home that is listed as a short sale. The seller accepted my offer; however five days later the listing price on the home was increased to $50,000 more than the original listing price and my offer. Is that possible? If so why?

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Until you have a binding contract, the seller can do anything , at his sole discretion. I'm speculating that the listing agent is trying to show the bank negotiator that they marketed the price at a higher price. The truth about the time line and offer prices is available to anyone who has mls access in listing history. The bank will order an appraisal, it your price is too low, the bank will insist that the property be marketed at least 120 days at the new price.
1 vote Thank Flag Link Tue Apr 3, 2012
This is a difficult question to answer without knowing more about the transaction. The listing agent probably has a strategy they are working out with the lender. I have had to change the listing price on my short sales even after seller approval of an offer to usually play along with the bank (they requested the change). It did not affect the offer that we were under contract with. I am not saying your scenario is like this, but this could just be one of the many. I would have your agent follow up with the listing agent on this - I don't think it will hurt the transaction to know the reason for the list price change.
1 vote Thank Flag Link Tue Apr 3, 2012
Thank you all for your answers. I informed my agent and she stated that there was nothing to worry about as the seller has already accepted my offer. However I am worried about my chances of getting the house now. Not sure what to do.
0 votes Thank Flag Link Thu Apr 5, 2012
The short answer to your question is "yes." As you can see from the answers below, there could be any number of reasons that the seller would want/be required to continue to market the property, including changing the listing price. One other thought would be to check the provisions of your accepted offer (contract). Assuming your offer was prepared on the Colorado Real Estate Commission approved form(s), your contract should have included a Short Sale Addendum (a link to the blank form is provided below). In the last section of that addendum, Section 8.4, you should have checked one of two boxes. If you checked the box in Section 8.4.2, the seller has the right to accept subsequent offers from other buyers without liability to you. That same provision allows both you and the seller to terminate the contract for any reason before the bank accepts the short sale. If you checked the box in Section 8.4.1, neither of those rights applies. If you have questions about your rights or the seller's rights under the contract, you should consult with legal counsel. Good luck!
0 votes Thank Flag Link Wed Apr 4, 2012
Have you asked the listing agent about this? The bank could have required it based on a BPO but the only person who can really answer your question is the listing agent.
0 votes Thank Flag Link Wed Apr 4, 2012
I'd say that that is definately a question for the listing agent. It sounds like a bad tactic for the seller as often BPO's or appraisals come in close to list price, so they may be shooting themselves in the foot. I'm not saying this is what they are "told" or "directed" to do, I'm just making an observation.
0 votes Thank Flag Link Wed Apr 4, 2012
Your offer is contigent on the bank accepting your offer. You have MEC (mutual execution of contract between buyer and seller) but you do not have short sale acceptance from the lein holder(s). Looks like the bank thinks the value of the home is more than your offer (or listing price?). Welcome to the world of shortsales.
0 votes Thank Flag Link Tue Apr 3, 2012
That may be a requirement from the bank. The fact that the Seller has accepted the short sale offer does not mean that the Bank is required to accept the offer. If the bank "counters," meaning that if the bank requires a larger payoff for what they are owed, then that is the amount that the bank will require in order to sign off on the short sale.

I hope that helps you.
0 votes Thank Flag Link Tue Apr 3, 2012
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