Home Buying in 85208>Question Details

Aimee, Real Estate Pro in Mesa, AZ

If a short sale listing price is dropped substatially, does this mean that the lender is actually willing to take the loss or jus trying to hook buyer

Asked by Aimee, Mesa, AZ Thu Jun 16, 2011

What are the chances of the lender approving our offer if we offered their reduced listing price? The listing price is the max that we've been pre-approved for unfortunately.

Help the community by answering this question:

Answers

7
BEST ANSWER
Usually, not always, the list price is where the seller would love to have an accepted offer at. Sometimes, if the home is a great deal, it'll be used as a starting point if there is a bidding war going on with multiple offers, but it's much more a buyer's market these days so at least where I am at the list price is often the highest a home would ever sell at (I suspect it may be the same for Mesa as well, but your local real estate agents will provide feedback I'm sure).

In a short sale the seller usually wants to sell their home as quickly as possible, but they also don't want to accept too low of an offer because their lender still has to accept it, and if their lender knows that the market value is higher than the offer the homeowner has accepted, they'll reject it and it'll start part of the process over again.

Now for this home it may have been the listing agent learned that the seller's lender will accept a certain price, and so in an effort to get it sold quickly it was reduced to that price, or perhaps they really need to sell it quickly, and they are lowering the price just to get any offer and see how far the seller's lender will go with it.

With a good real estate agent they'll be able to feel out the seller's side to determine if they are just "tire kicking" the seller's lender into seeing how low they'll accept because the property needs to sell quickly, or if they truly will be able to get the seller's lender to accept that price.
0 votes Thank Flag Link Fri Jun 17, 2011
Unless it is a preapproved short sale by the lender, the price was set by the listing agent and seller. What the lender is willing to accept is yet to be determined until they repond to an offer. Some agents will set a low price to get any offer. The idea being that by submitting an offer (even one that the lender might never accept) the lender will open the file and start the short sale process that can take many months to even get a reponse. Eventually the lender will respond by accepting the offer or rejecting it and saying what they will take. At that point there is a price on the table and even if the buyer who made the offer does not want to buy it at that price the real price has been established by the lender. The short sale process has now moved along so that someone offering the lender's price can buy the home and close quickly.
0 votes Thank Flag Link Fri Jun 17, 2011
The bank does not set the price, the listing agent does, one of the highest short sale killers is listing the property substantially below market value. The bank will assess the value through their own appraisal and if a short sale is deemed acceptable , the price will be at or just below current market value.

http://www.trulia.com/blog/scott_godzyk/2010/10/so_you_want_…


Please see my blog for tips on buying a short sale.
Web Reference: http://www.ScottSellsNH.com
0 votes Thank Flag Link Fri Jun 17, 2011
As for the price reduction--in order to determine a fair value/offer review comps with your agent, recently sold similar properties in the immediate area, see what the data suggests--keep in mind that if the property is listed at today's market or slightly below, multiple offers may occur; also keep in mind that short sales are by no means fast sales; if you are not in a rush to buy, no reason not to consider making an offer.
0 votes Thank Flag Link Fri Jun 17, 2011
Its is most likely a teaser price, the actual price that a lender will accept is not yet know, but if it is a property you like and you don't mind waiting for a response to your offer, go for it and see if the asking price will be accepted!
Iy never hurts to try!
0 votes Thank Flag Link Fri Jun 17, 2011
Aimee,

On short sales, sellers and their agents should be working together to identify potential buyers and in doing so SHOULD be keeping the pricing of the home in step with the local real estate market. The final number has to be reasonable and defendable to the lender.

This may or may not apply to all situations. In those that have been decreased with little attention paid to the local RE market, they will find themselves in a position to renegotiate the final price with the lender.

In short, some prices are accurate reflections of the current market while others..............well, let's say, it is fishing season!

Good luck,

Bill
0 votes Thank Flag Link Fri Jun 17, 2011
Aimee;
It could be (a), (b), or even (c), (d), and (e).
There's only 1 way to find out......make the offer, put in your time, and see what happens.
Good Luck.
Web Reference: http://www.321property.com
0 votes Thank Flag Link Fri Jun 17, 2011
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2014 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer