Welcome to the wonderful world of short sales. The sellers acceptance means nothing on a short sale since it is the bank that is taking the loss. Over the past 4-5months I have noticed that the approvals to my solid short sale offers, and even my foreclosure offers have come to a ginding halt - even with my realtors who know how to navigate the distressed sale market.
The story I am hearing is that banks feel that they have hit the bottom of the market, are no longer sitting on a declining value asset, and are more willling to wait for a better offer than in months past. I do not think this is exactly true - the market details at least. But you are not alone in your frustration in waiting for an offer to be approved or denied,
The advice I give all my clients - use this time to your advantage. There is not a shortage of homes on the market right now but there is a shortage a good, well priced homes -and those do not stick around very long. While the bank is deciding whether or not to take your offer, keep looking at homes for sale. Your dreamhome for the dream price may be just putting the for sale sign in the yard right now. Keep your options open while the approval proccess plays out at the bank. There is no other home offer process that will allow for you to keep shopping for 3-5 weeks. Use this as an advantage instead of detriment.
Mark Good, firstname.lastname@example.org Prime Properties of NE Florida, LLC
The best way I have come to explain this to the Buyers I work with on Short Sales is, it's like going to Las Vegas. The house always wins. It's the same with a short sale.
All I can speak from is experience and I can tell you that if the lender has been working with you and responding to your counter offers, this should resolve in due time. Unfortunately there is no magic time line or even required timeframe. Just be patient. You should close soon enough. Hope all goes with with your purchase.
Do you have your own agent representing your interests? If so, ask her to get the following information for you:
Is the owner occupying the house or is there a tenant living there? Is the owner going under the HAFA program? Who is the lender that actually owns the mortgage. The "servicer" handling the mortgage probably does not own the mortgage and is a mere middleman collecting fees to "manage" the loan. When the owner purchased did they put down at least 20%? IF not, then the Private Mortgage Insurance company must also approve the short sale.
If the "servicer" is Bank of America, ask your agent to ask the listing agent for a "print out" of the Equator screen to prove it is on track for approval.
Oh and if there is a tenant living there, the seller may just be dragging out the process to allow him to continue "free" rent money for extra months. Also there are some listing agents who will engage in mortgage fraud by trying to get a lower priced approval for the short sale (your previous lower offers) and then put their "insider" investor on the contract to buy at the lower approved price. Once they have the approval for that buyer they will "flip" the property at a higher price by closing a week later with you as the buyer.
You absolutely need to continue looking for a property (only look at genuinely available homes - bank owned and regular sales) until theyday you get the short sale approval letter in your hands listing you as the buyer. On a fraudulent flip they will not be able to provide this because their insider buyer will be listed as the buyer!
ALL CASH buyers are the prime target for short sale fraudsters so if you're paying ALL CASH you MUST get an attorney to review your closing paperwork and title committment before you sign or hand over your cash at closing.
The one thing about short sales is ~ the rules keep changing. Along with that, the values keep changing and what the investor will accept keeps changing.
First of all, Sellers will usually sign anything because they are not getting a dime out of the transaction and they are trying to avoid a foreclosure.
Second, the investor has to approve the sale, so it sounds like there are some mis-communications going on here possibly between the negotiator and the investor. 48 hours turning into 45 days means something is not right.
Third, my advice would be to escalate this to the executive offices of the President of the bank to see if you can get this straightened out. If not, then move on to another house. There are some negotiators who actually make more money by servicing the loan and letting it go into foreclosure than they do selling them. You may have run into one of those. Going to the top will blow the whistle and get some action. There are a couple of other things that you could do beyond that, but try the office of the President of the bank first.
You and your Realtor have been very patient, now it's time to take it to the top and see if you can get this resolved.
If you found this helpful, please give me a "thumbs up."
Frank & Sharon Alters, CDPE, e-PRO, GRI
Coldwell Banker Vanguard Realty
DAVID COOPER. Foreclosure and Bank REO Buyer's Agent at Verticle Realty-Las Vegas. 35 years experience. FReee List +1-7024997037...email@example.com
Sorry to say, but this is the wonderful world of short sales, and it frustrates everyone involved in the process.
The house not appraising would be more a function of your lender not being willing to loan more than the house appraised at, which is standard procedure.
I would wonder why the bank promised signing within 48 hours, and then not delivering. Have you talked to your agent or the listing agent about this delay?
The short answer here is: check your contract, and see if you are within your rights to cancel this contract and move onto another house. Unless there is something so special about this house you just can't live without, I'm certain you can find something very similar that can close more quickly.
Good luck -
Prudential Network Realty
The bank is under no obligation to sell at all and they can change their mind any time they wish.
They get to make all the rules and change them at will.
In the end, short sales come down to how much money the lender is willing to write off as a loss. Depending on the lender, the day of the week and the time of day, that decision is likely to change.
The real question is, where are the offers in relation to the amount owned on the loan? The bank wants to recove the max possible. Where was the Listing price in relation to the amount owed? Quite often, the Bank will agree to a Listing price that is quite low in order to generate multiple orders. So, saying you gave them a full-priced-offers, is meaningless.
In regard to time limits; the banks are notoriously slow. There have been many instances where the bank beats-around-the-bush and loans expire and information has to be updated. That's the nature of the breast.
You have to be patient, particularly with a SS as the bank secretly hopes that they can go to Forclosure.
Do not try to understand the bank's rationale.