Home Buying in Caldwell>Question Details

Jpage, Home Buyer in 83607

In Idaho is it ok to have offers out on multiple homes that are short sales?

Asked by Jpage, 83607 Wed Mar 10, 2010

We have an offer out but an waiting on the bank approval we heard that it is wise to keep looking and if we find another home to put an offer on it and take the one that is accepted first by the bank. Is the legal and ethical?

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7
Write you offer with language that says you are making multiple offers. Proper language can protect you. Make sure your realtor knows how and uses it. Sellers do not like it BUT they do the same to buyers with multiple bidding.
0 votes Thank Flag Link Thu Mar 11, 2010
Yes .... start home buyer !

We instruct our clients to do that not always true the bank could accept your offer while you are waiting around for weeks, months, and etc.

Lynn911
Web Reference: http://www.lynn911.com
0 votes Thank Flag Link Thu Mar 11, 2010
I agree with Brian on this. Disclosure is the key. For example, I just wrote up an offer for one of my buyers and instead of just using the standard RE-44 Short Sale Disclosure form, we added a provision that allowed the buyer to back out within 24 hour notice of their offer being accepted in case we had another offer we were working on get accepted first. Since we never have an exact time to anticicipate a resonse from the seller's lender, how can you agree to wait indefinitely?

Some short sales are putting in penalty clauses if the buyer backs out within 60 days regardless of whether the seller's lender has accepted or even responded. That would typically keep many buyers from putting in multiple offers simultaneously!
0 votes Thank Flag Link Thu Mar 11, 2010
Jpage,

The short answer is yes, but you have to disclose it. Unfortunately, not even most buyer's agent understand the law behind it and can actually be putting their clients in legal jeopardy by advising them incorrectly.

I've actually already blogged the long answer to this question if you're interested you can view it at: http://www.brianbrumpton.com/blog/?p=15.
0 votes Thank Flag Link Wed Mar 10, 2010
It is ok if the situation comes up that they all get approved and you are on the hook to purchase all the homes. If you are looking for a proncipal residence and not as many different investment properties, it would not be wise to make multiple offers on different properties if you only intend on buying 1. Your best interests are puuting all your efforts on the 1 short sale, making sure the listing agent got the sellers approved to even do the short sale and then there is already a negotiator assigned the loan and then that they got the appraisal doen for the bank. A short sale requires daily calls to the bank to get anywhere
Web Reference: http://www.ScottSellsNH.com
0 votes Thank Flag Link Wed Mar 10, 2010
It does happen that people place multiple offers on short sales, did you sign the short sale addendum for that property? If so then it does allow you to back out of the sale at anytime. I would talk to your agent about making other offers and see what they have to say..they know your situation and the situation of the sale more than I do. There are always pros and cons to making multiple offers, pros is that you increase your odds of getting a home in a short sale, cons if you have mulitple offers out there then the sellers and the sellers' lenders may view you as a "not a serious buyer" for that property and that may make it difficult to get your offer approved. But again you need to ask your agent some serious questions.
0 votes Thank Flag Link Wed Mar 10, 2010
Do you have the finances to buy multiple homes? If not, then don't write multiple offers.

Work with an agent who holds a CDPE (Certified Distressed Property Expert) or SFR (Short Sale and Foreclosure Resource) designation, commit to one short sale home and see that contract through. There is SO much bad advice happening out there in regard to short sales.

Everybody has heard a short sale horror story - and they love sharing their experience. The reality is that it doesn't have to be that way and a lot has improved in the processing of short sales in the last year. We're not done working out way through these distressed property sales. It's a complicated process and is not for every buyer or every agent. My fastest short sale last year was 30 days. My longest was four months. And, there were many along the way where the buyer's patience ran out before the short sale process could be completed.

FYI - in a short sale, the contract is between buyer and seller. The bank reviews the contract and is the deciding authority on whether a short sale is acceptable or not (based on a lot of factors), but the contract is still between buyer and seller.

Have a blessed day!
Ronda
0 votes Thank Flag Link Wed Mar 10, 2010
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