If you are still looking to buy, I would be glad toanswer your loan questions-thanks

First find out if there is more than one mortgage owed on the home. Banks will typically take 20% off what is owed on the first mortgage and up to 80% off the second. That is only a general guideline and every situation varies. Once you know what the total amount is owed to the bank, I would make an offer at least 30% below that mark as the bank will often counter. HOWEVER you will need some comparable sales to prove your price request so do your homework and have a good HUD statement made out for the bank when you submit your offer. There are a million different opinions that people have as how to approach a short sale but the truth is every deal works out different. If you bid to low the bank may reject it. You may end up waiting weeks (if your lucky and more likely months) just to get a yes or know, so if you want the home I wouldn't get overly aggressive.

May I suggest that you hire a local agent to represent you in this process? Someone familiar with short sales. If the agent is unsuccessful, then you won't pay them anything. If you need a referral, just email me and I will connect you - vchrisner@kw.com

John,

You'll want to pull the lists of comparable homes that have sold in the area and see what similar homes have sold for. You'll need access to MLS for this and when you come in tomorrow we will take a look so you'll have a better idea.

You will need to get the current Builder/Owner to work with you. He will need to apply to the bank to conduct a short sale. He will need to submitt a hardship letter and other paperwork such as two years of his tax returns, two months bank statements etc.... If the owner is willing to work with the bank you have a shot. It would be best to have him use his Realtor to start the process. If the owner is not interested in conducting a short sale, then you will need to wait till it forecloses. It generally won't sell at auction and will go on the market. Your agreement is with the owner and the bank won't honor your lease. However they are usually happy that someone is maintaining the home. At least you have one thing in your favor; the lender isn't Countrywide or BofA.

Has the bank disclosed their opening bid yet?

What is the market value of the home with regards to recent comps?

Is the seller willing to do a short sale? If so, the bank is going to request their own Brokers Price Opinion (BPO) to determine the current market value and base their decisions off of that, not the current list price.

It may be that the BPO and the list price are similar and in which case you can offer less.

Short sale negotiating is all about the BPO...well, not ALL, but most of the banks decision making will have to do with that and the note.

Call if you would like a little non-obligatory assistance :).