Kerry
Which bank holds the mortgage? This information is public record. If it is Bank of America I might be able to track down some info.
Ruth Bonapace
Bank of America

Okay, this is a tough love answer! Do you have an agent? The questions you ask would indicate you do not and there's no way, in my opinion, you should be pursuing a short sale property without one. (It costs you nothing since the bank pays the fees, and, believe me, they are not going to give that money to you even if they don't pay a buyer's agent) Short sales are much higher risk and much higher anxiety purchases than others. For this reason alone, you need a realtor and an attorney who know the process and can help mitigate those factors.

As to improvements -- for most short sales -- you buy what you buy. Most banks will not make adjustments for inspection items found after the price has been agreed, which, it seems, is where you are.

The Chester market was revalued in 2006 (although you didn't say you were buying in Chester), but wherever you are buying, you need to know what has happened to values vs sale prices in that area since the last revaluation. The degree of change in the market is also relative to the price point of the home. (In some markets, 600K homes are selling like hotcakes and going over assessment, while homes above $1MM continue to stagnate). You also need to know if the assessed value is the result of the last revaluation, or has been successfully appealed (and when). As you can see, the specific market and house must be considered to address with your concern. Why not just get an appraiser for value? An appraiser looks backward at closed activity in a market to place value on a property, so that will give you a guide, but not necessarily a current value. A realtor will look at the current market and consider trends as well as closed activity. The two interpretations of the market value can be very different and the appraiser's value will generally lag trends in the market -- when markets are moving up or moving down -- which is most of the time. If you have been familiarized with the market and educated through the services of a realtor (for which they deserve to be paid at the end of the day), you should be able to place a value without the appraiser. That being said, it seems your offer is made, without adequate information to know if it is correct. You need a relationship with someone whose advice you can trust, or you are basically guessing at the value. Not a sound approach for such a large investment.

Janet Ellis
Sales Associate
Keller Williams Towne Square Realty
908-581-6349
Resident of Chester

Part of buying a short sale comes the risks. You are not the only consumer who is facing major frustration while engaged in one of these transactions. You seem to have been informed on some level about the gamble you are taking since you have stated you hope those "horrors" don't happen to you!

You are not going to get the name of the bank rep because the owner is the only person who can authorize your speaking directly to the bank/lender. If you ask the seller, they most likely will not let you speak with the bank. There is too much information the bank has that the owners will not want to share with you.

The listing agent may have a few back up offers. He/she is protecting her sellers best interest by doing so. In NJ, a sellers agent represents the fiduciary interests of the seller and the buyers agent of the buyer. So, the agent is doing her job.

The bottom line is that eventhough the home is marketed cheaply, it is done so to bring in many offers and drive the price up. The sellers and the banks want to ge the most they can for the property. My experience has been that the people who lowball the offers do not get the property.

You can order an appraisal, but the bank will order one themselves and probably ordered a BPO (broker price option) already and they have a very good idea of the value of the property. They might counter your offer or outright reject it. There's no way of telling as each bank/LMO (loss mitigation officer) has a procedure they follow.

Assessed values have come down dramatically in most markets since 2004. (I cannot comment specifically because I don't know what town you are purchasing in.) The bank should be aware of that. You state above that you put in a "lowball" offer. Yet, you also state that you are concerned about the value due to the repairs needed. Most buyers who put in a lowball offer have left a considerable amount of leeway for the improvements needed--no need for worries about bringing the house in above market value.

I advise all my short sale buyers of the pitfalls of putting in lowball offers. Buying a short sale is like a crap shoot! Sometimes you get lucky, sometimes you don't! If the house really means that much to them, they put in an offer very close to asking as usually a short sale price is dramatically lower than market value (and it has already taken into consideration the $$$ for the work needed to be done.) The banks know it, the agents know it and most of the buyers do, too! That's why they take the risk.

Hi Kerry, as you can see from prior answers, there is little you can do to influence the process. What I have learned from experience though is that the communication makes a great deal of difference and when that is broken the level of frustration and confusion can be maddening. I've had deals that have gone both ways - the best of communication by all parties and the worst. In the end it comes down to how quickly and effiiciently the bank handles the process, BUT what may save you time is good communication on the part of the listing agent. With that possible issues in mishandling by the bank may be discovered early on so that you don't lose unnecessary time. They are long enough at the best, loosing months when people are just not communicating is really aggregious in my book, and I am in the midst of a short sale right now in which this is the case.

So ask your agent to stay on top of the listing agent and hope for the best. Final recommendation, do yourself the favor of continuing to look. 3 of 6 short sale buyers I have worked with did just that and before we heard back from the bank they found something they preferred and we are either closed or soon to close. Of the other 3, only 1 had closed - the other 2 remain alive - and are crawling along (one since May!)

Good luck,
Jeannie Feenick
"Unwavering Commitment to Service"
Search the MLS at http://www.feenick.com

Hi Kerry, as you can see from prior answers, there is little you can do to influence the process. What I have learned from experience though is that the communication makes a great deal of difference and when that is broken the level of frustration and confusion can be maddening. I've had deals that have gone both ways - the best of communication by all parties and the worst. In the end it comes down to how quickly and effiiciently the bank handles the process, BUT what may save you time is good communication on the part of the listing agent. With that possible issues in mishandling by the bank may be discovered early on so that you don't lose unnecessary time. They are long enough at the best, loosing months when people are just not communicating is really aggregious in my book, and I am in the midst of a short sale right now in which this is the case.

So ask your agent to stay on top of the listing agent and hope for the best. Final recommendation, do yourself the favor of continuing to look. 3 of 6 short sale buyers I have worked with did just that and before we heard back from the bank they found something they preferred and we are either closed or soon to close. Of the other 3, only 1 had closed - the other 2 remain alive - and are crawling along (one since May!)

Good luck,
Jeannie Feenick
"Unwavering Commitment to Service"
Search the MLS at http://www.feenick.com

Kerry,

On a short sale the bank looks at one offer at a time. If your offer is signed by the seller and is in attorney review or under contract, than you are protected against other offers. The banks process is such that it can take 2-4 months depending on the bank. As far as paying for an appraiser, this is not necessary as the bank will only look at their appraisal. However, if you are getting a mortgage, you should start this process now as you will have only 30 days to close once the bank accepts your offer.

Of course the bank will not talk to you. You do not own the property or have any financial interest in it at this time. The best thing you can do is have your buyer’s agent provide you on updates from the seller’s agent. Updates will be had about every 2-3 weeks. So be patience.

The short sale process is long, requires a lot of patient but in the end will get you a good deal. Email me if you need more information as I have done many short sales.

Maryann Johnston
Coldwell Banker, Chester
maryann.johnston@att.net

Hi Kerry. Welcome to the world of short sales!

As the buyer, it is not likely that the negotiator will speak with you. The bank requires a signed release in order to share information. It is typical to authorize the listing agent and/or facilitator to negotiate the deal on behalf of the seller. The listing agent may be holding a back-up offer; this is quite common. Back-up offers and the Right of First Refusal are common practices. The listing agent is responsible to sell the home. If the bank comes back with a valuation which is higher than your contract, the listing agent will contact the back-up buyer. If you have a Right of First Refusal Clause, you may match the other offer and consummate the deal. Your agent can assist you in obtaining a market value of the home by providing recent comparable sales. It is also helpfull to know how many homes are on the market and for how long; remember, the value is based on "sales".

If you are planning to stay there for many years and make it your home, try not to get over-concerned about the value after-improvements. Today's value will be verified by the appraisal used to obtain your mortgage. Tomorrow's value will be something different!

Robert Greenblatt
Keller Williams, Cherry Hill