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Chikcen, Home Buyer in Rockland County, NY

My husband and I are purchasing a short-sale. Our offer was verbally accepted by the bank (this is according to the seller's lawyer) and the

Asked by Chikcen, Rockland County, NY Mon Nov 16, 2009

subsequent contract was signed by us (the buyers) and the seller. My husband and I have received our commitment letter from our bank. We've been waiting now for almost five weeks to receive a closing date. Now we learn from the seller's agent that the bank is willing to close if we agree to their price increase. Is this legal? Contracts have been signed and our loan application has been approved, and the bank wants to raise the price now?! Our lawyer says he's never heard of such a thing. Have you?

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A short sale is a different kind of transaction than the normal real estate purchase. You are essentially going to wait while the Seller negotiates with their Lender(s) for approval to sell you the house at a price lower than what is owed to the Lender(s). This process can be lengthy, even stretching out to many months before you have a final answer.

You'll need two things during that time:

1. Patience. While you've submitted all your documents to your Lender for your mortgage approval, and you keep your documents current and updated, you'll grow frustrated with the lack of any communication from the Seller about the status of the short sale. This is common, both the poor communication and the Buyer's frustration. Prepare for it.

2. Maintain your credit scores. Be sure not to make any dramatic changes to your credit report that could affect your credit scores. Pay all bills on time. Don't CLOSE any accounts. Don't open any new accounts. Don't run up your outstanding balances to max your revolving debt.

Once the short sale is approved, you may find the price you offered is not acceptable to the Seller's Lender. They may come back and counter-offer your price, so you will have to reconsider at that time if you wish to pay more than your original offered price.


The three rules of real estate: Location, Location, Location.
The three rules of short sales: Patience, Patience, Patience.

I hope that helps!
Trevor Curran
NMLS #40140.
Trevor Curran
NMLS #40140
Mobile: 516-582-9181
Office: 516-829-2900
Fax: 516-829-2944
PowerHouse Solutions, Inc.
185 Great Neck Rd, Suite 240
Great Neck NY 11021
Licensed Mortgage Banker – NYS Dept. of Financial Services
NMLS#3528
0 votes Thank Flag Link Wed Sep 12, 2012
For the fact the home owner is still on the property deed, he needs to sign the contract, but just because the home owner accepted your offer doesn't mean the bank will accept it. Because of the short-sale status and or other conditiions on the contract the bank can reject your offer. the bank usually does what's is called a BPO and requests for the property to be appraised. Don't forget that the bank can also foreclose on the property you're trying to purchase but that can take months. Short-sales are trickie and it depending on the file different scenarios can happen.
0 votes Thank Flag Link Wed Jan 27, 2010
Only an attorney can answen a legal question, however, there are conditiions on the contract that may allow changes to be done after a contract has been signed. Check your contract with your attorney and make sure this was not of the conditiions.
0 votes Thank Flag Link Thu Jan 7, 2010
If the contracts are not signed with the price agreed they can change the price when ever they want cause they are going to continue receiving offers from other people.
0 votes Thank Flag Link Mon Nov 16, 2009
Be Ware, Short Sales are very trickie and sometimes take several months to close, people can out bid you and the bank can ask for more! If you have a realestate attorney and he is telling you this, seek a second opinion as well. I try my best to stay away from short sales, I have had three clients so far be outbided, then the bank comes in and asks for more!! I have one that has been in the works for 6 months now!

Good luck!
Millie from Exit Realty
0 votes Thank Flag Link Mon Nov 16, 2009
Good afternoon Chikcen
Yes I have delt with this befor, Here how Short Sales work, when ever you are purchasing a Short Sale the contracts states that the offer must be subject to a bank aproval. If you bought this property through a Broker, a Broker should have advised you that there is nothing in stone till the bank aproves the package. All offers must be signed and accepted by the existing owner and then the package goes to the existing lender for aproval. This aproval period is usualy takes between 4 to 8 week. The answere you received is legal & hapens all the time when the bank feels that they have a property that is assesed for a lot more than your offer that they have on the table.
0 votes Thank Flag Link Mon Nov 16, 2009
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