Home Buying in Bellmore>Question Details

Emily, Home Buyer in Massapequa, NY

If a bank reverses their counter offer on a short sale house appraised for less what are my chances that I will finally get the house.

Asked by Emily, Massapequa, NY Thu Dec 13, 2012

This is a short sale purchase in Bellmore NY and we got a commitment and we are waiting for the seller's bank to approve the offer. They countered by 100K more then what the house is appraised for. Do we have any chance of finally getting the house. Waiting almost 5 months now.

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John Sacktig’s answer

If the Bank number is 100k more than you offered, then it sounds to me that your offer was extremely low. I do short sales, they are not that bad. But, most buyers think that just because it is a short sale the bank will take anything to get the house off their books. Not true, not true at all.

There are numbers involved here.. and if it is 100k more that number had to come from someplace and most likely an appraisal, which was probably low for the area as bank appraisals have been coming in pretty low... I have seen people come into an area that has 800-900k homes..now really valued in this market at 700k and wanting to offer 400k stating, well it is a short sale and "the bank should just take it" This is not realistic and does not work.

Hopefully you did not waste money on an attorney and inspections without an approval.. as none of that is necessary until the bank says they will accept your offer. Agents push to do this and people get a false sense of security that their offer will be accepted. The only people that get what they want is the attorney and the inspector.

Email me, I am curious, what is the house listed for and what did you offer? What is owed on the home? Did the agent pull the comps for you before you made an offer? Did you just go with your number hoping that you would get it? Important details on that offer that you made.
1 vote Thank Flag Link Tue Dec 18, 2012
Emily you're not off to a good start by the sounds of it. There is a possbility that the listing agant priced the house excessively low or your accepted offer is low; we don't have the details. However with such a large discrepancy, the listing agent, attorney or whoever is negotiating the short sale on the sellers behalf need to be on top of their game to justify your offer and close this gap; if they can't unfortunately you would waited in vein unless you are willing to give the bank what they are looking for.
0 votes Thank Flag Link Sun Dec 16, 2012
Hi Emily. I advise that you seek the counsel of your Attorney and Realtor. They can best answer your question. Hoped this helped.
0 votes Thank Flag Link Thu Dec 13, 2012
Unfortunately none of us can accurately speak for the lender...it could go either way....
0 votes Thank Flag Link Thu Dec 13, 2012
You have entered "the Wild, Wild, West of Real Estate" short sales, where there is an illusion of rules but anything can and does happen. As a buyer, you are the least significant player is the very complex, highly convoluted, logic lacking, opaque real estate transaction. ANYTHING CAN HAPPEN!
One issue with SS is you can not be aware of the alternatives available to the organization holding the mortgage. Available to them are multiple income sources, you the buyer are just one. There may be an 'end-game' buyer already in place and all this process is about is optimizing the margin. We do not get the opportunity to peek behind the curtain.
In a similar situation, in a Bank of America negotiated SS, they did adjust the 'negotiated price' to match the appraisal....HOWEVER they added a requirement for the buyer to bring $93,000 in cash to closing. YIKES....and my buyer agreed! Anything can happen. This was what the home was worth to him.
Then the SELLER/HOMEONWER, realizing they would owe income tax on 600 thousand dollars attempted to pass that $100,000 tax bill onto the buyer as a condition for accepting the offer. (***!!!###) So, in reality, the acquisition cost of this home will be nearly $200,000 more that would be reflected in the "sold' price. Of course that resulted in 'no sale' for this buyer.
Emily, anything can happen.
Do your homework. Determine what this house is worth to you. Then negotiate as best you can. Be aware, there is not a 'good faith' party on the other side. Don't fall in love with a short sale home. You could be left at the alter.

Best of success to you,
Annette Lawrence, Broker/Associate
Remax Realtec Group
Palm Harbor, FL
0 votes Thank Flag Link Thu Dec 13, 2012
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