Home Buying in 92010>Question Details

Tang, Home Buyer in 92010

If a short sale offer is accepted by the bank, does the bank give the buy an approval letter?

Asked by Tang, 92010 Thu May 12, 2011

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Yes there is a Short Sale Approval Letter that is given to the Seller who in turn must give a copy to the buyer per the Short Sale Addendum within 3 days of receiving the approval.
1 vote Thank Flag Link Thu May 12, 2011
In California, the standard CAR contracts require the seller to provide the buyer with the approval letter in order to start the escrow period.

Therefore, the bank doesn't provide the letter, the seller/listing agent should provide the letter.
Web Reference: http://www.FlockGroup.com
1 vote Thank Flag Link Thu May 12, 2011
Hello Tang,

I hope this message finds you well. If a property has a short sale approval the seller gets an approval letter describing the terms and conditions of the sale which includes the buyers name on file.

I hope this helps.

Best Regards,

PM
0 votes Thank Flag Link Mon May 16, 2011
Hi Tang,
The bank does not give you (the buyer) the short sale approval letter, but the seller or escrow company handling your purchase absolutely should. Sometimes, there are provisions on the short sale approval letter, i.e. that it cannot be resold for 30 days, what closing costs the bank is willing to pay, etc. that the buyer must be made aware of. I always have the buyer sign the short sale approval letter as proof that they have received and read it. If you need further assistance, please let me know.

Thanks,
Sinead McAllister
Broker, McAllister Homes
Oceanside and North County San Diego Experts!
(858)205-5215
0 votes Thank Flag Link Mon May 16, 2011
Yes, A shortsale approval letter with be sent to the Sellere agent and Seller. Make sure you ask for a copy of the letter for your record.

Bree Estape
K. Ann Brizolis and Associates
Bree@prusd.com
858-405-2003
Web Reference: http://kabrizolis.com
0 votes Thank Flag Link Thu May 12, 2011
Tang,
Good question. The short sale offer letter stating an has been accepted by the bank will typically go to the seller or the sellers real estate agent. It is their responsibility to provide you with a copy of it. I would make sure you do get a copy of it for your records.

Leslie Lawson, Realtor
THE BEST MOVE YOU'LL EVER MAKE!
DRE#01896125
951-852-0080 Direct
leslielawson@realtyexecutives.com
0 votes Thank Flag Link Thu May 12, 2011
Tang,

The short sale approval letter will be provided to the seller. It is the seller and their agent's responsibility to then provide the buyer and their agent a copy. If your agent used the proper forms, the receipt of this approval and seller's acceptance of the approval starts the contract timelines.

Kind Regards,

Marcie Sands, REALTOR
Simply The Best Real Estatae Co., Inc
760-644-1562
0 votes Thank Flag Link Thu May 12, 2011
In order to complete a short sale the sellers have to:
1- Accept an offer that should include the Short Sale Addendum
2- Receive a formal Short Sale approval letter from all lien holders (the terms of the Short Sale Approval, included the price, could be different than the ones of the original offer)
3- Give a copy of the letter to the buyers in accordance with the terms of the Short Sale Addendum
4- Buyers and sellers have to agree to the terms of the short sale approval
5- If the sellers do not agree to the terms of the Short Sale, they can counter the lenders but they can also decide not to sell
6- If the buyers do not agree to the terms of the Short Sale they can also counter but in doing so they also give the sellers the option to accept another offer from a buyer willing to accept the terms of the short sale approval
5- Once all parties agree to all terms, buyers and sellers will proceed with the sale (escrow) and the fulfillment of the remaining contractual obligations.

I would suggest that you talk to your agent and ask if the seller has already received a formal Short Sale Approval letter.

Daniela Marshall
Realty Executives
760-809 3003
CA DRE License 0156741
Web Reference: http://DanielaMarshall.com
0 votes Thank Flag Link Thu May 12, 2011
Make sure you reconcile the terms of the approval letter with the sale contract. The bank doesn't always approve paying for everything the seller agreed to in the contract and if the seller decides they won't pay for say, example, termite repairs, then you need to know that now. Not all short sale agents or sellers are created equal.

BeachBrokerBill
DRE#01775528
0 votes Thank Flag Link Thu May 12, 2011
The short sale approval letter you should get from the seller's letter should be read carefully as it has terms which may not be the same as you and the seller agreed to on your purchase contract. Both buyer and seller review this letter to ensure they both agree to the conditions and wish to proceed with the sale. It is not that easy to renegotiate items found on this letter, but it may be worth a try if something is disagreeable.

Often there is just a net amount the lender expects to receive shown on this letter, but you should try to get details on items such as termite inspection and repair, home warranty, HOA delinquent dues, HOA doc and transfer fees, seller credits, personal property, and any non-standard items in your purchase contract.
0 votes Thank Flag Link Thu May 12, 2011
Yes! we negotiate with the bank to take the lower amount. There is never any cost to the seller for our work on the file. We counsel the seller on the necessary paperwork that is required, and then work with the Bank to close the transaction. Please call if I can be of any assistance.
Ron Oster
Ascent Real Estate
2900 North Park Way
San Diego Ca 92104
619 543 0414
0 votes Thank Flag Link Thu May 12, 2011
Hi Tang, assuming the CAR Residential Purchase Agreement (RPA) was used to make the offer and 2) the RPA was also submitted with the CAR Short Sale Addendum (SSA) then the Short Sale Lender(s) is contractually obligated to provide you with the Lenders' short sale approval within the time period specified in the SSA. If the SSA was used your responsibilities as a buyer start once the Lender provides the Short Sale approval letter(s) – you should really read this 2-page document to understand your options! If the Seller does not provide this SS approval letter by the due date established by the SSA you can transition to another property if you deem this necessary.

Hopefully, your agent protected your best interests by submitting the SSA form!

Best, Steve
0 votes Thank Flag Link Thu May 12, 2011
Tang,
The bank who is accepting the short sale will issue a letter/addendum that will spell out the terms that they are willing to accept. This letter will state what they will pay for ie. termite repairs, home warranty or closing costs as well as the sales price or net proceeds that they will accept. This letter is issued to the seller who should have their agent forward a copy to your agent. This addendum becomes part of the contract so it is important that you and your agent review it carefully.
Short sales can be tricky so it is important that your agent is experienced in these transactions. It may take weeks or months for the bank to approve the short sale. Just because the seller accepted your offer, it does not mean the bank will accept the short payoff of their loan. The listing agent hopefully has been in communication with the bank and has an idea what they will accept.
Jerry Heard - Broker
CA Dre #00648687
0 votes Thank Flag Link Thu May 12, 2011
The bank will issue an approval letter to the sellers Realtor, they will be able to forward that the Buyer and their Realtor.

For more buying and selling tips, please visit http://www.RochesterHomeLocator.com

Salafia Sold Team
585-279-8210
http://www.RochesterHomeLocator.com
http://www.FindRochester.com
0 votes Thank Flag Link Thu May 12, 2011
Hi Tang,

The buyer in a short sale gets a short sale approval letter from the listing agent, as he/she is the one negotiating on the seller's behalf with the lender. Upon acceptance the lender forwards the letter to the agent, and that agent gives a copy to the buyer's agent. The listing agent must provide you with a copy within 3 days of receipt.

Best of luck,

Rachel LaMar, J.D.
LaMar Real Estate, Inc.
CA DRE license #01399682
0 votes Thank Flag Link Thu May 12, 2011
When the bank that holds the loan on the house you are buying approves the short sale - they will issue a letter to the seller giving the terms of the approval. By contract the buyer will show you that letter.
0 votes Thank Flag Link Thu May 12, 2011
Not exactly. Normally the bank will notify the listing agent that they will accept the offer, or more likely, will counter the offer with a higher price. They will then write up an addendum which spells out the terms of the purchase, this is what a buyer will receive. If the buyer chooses to move forward then escrow will open and it typically moves forward like a normal 30-day escrow from that point on. Tip: If you are house hunting and looking at short sales, look for one where the listing agent has an approved price from the lender. This means that the bank approved another offer and for whatever reason, usually because the bank took too long to respond, the previous buyer has walked away from the deal. If you make an offer at the approved price you could possibly get a quick response from the bank.
0 votes Thank Flag Link Thu May 12, 2011
Make sure you reconcile the terms of the approval letter with the sale contract. The bank doesn't always approve paying for everything the seller agreed to in the contract and if the seller decides they won't pay for say, example, termite repairs, then you need to know that now. Not all short sale agents or sellers are created equal.

BeachBrokerBill
DRE#01775528
0 votes Thank Flag Link Thu May 12, 2011
Tang, the answer is no. When you make an offer on a short sale you are already in need of a pre approval letter in order to even make an offer. You will get an accepted offer to purchase this property from the short sale bank, but they are assuming when your agent presnets an offer, you have already been approved by a lender. Let me know if you need to get pre approved as I would love to assist you with your needs to qualify for a purchase. Feel free to contact me at 619-784-9695.
0 votes Thank Flag Link Thu May 12, 2011
I think you mean buyer and no they don't. They issue the approval letter to the seller. I would request a copy of it before you move forward.
0 votes Thank Flag Link Thu May 12, 2011
Not right away. The bank has to go through there approval process. Depending on the bank it can take 20-90days and can sometime be longer. Every situation is different. Good Luck




Josh Enlow
Houston Team & Associates
0 votes Thank Flag Link Thu May 12, 2011
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