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Home Buyer 2…, Home Buyer in 20112

Negotiating after home inspection on short sale? Buyer

Asked by Home Buyer 2012, 20112 Wed Jul 25, 2012

We just had our home inspection on a short sale we are looking to purchase and found out there are some large repairs to be made. Has anyone had any luck negotiating concessions or a reduced sale price after a home inspection on a short sale? How did you do it and was is your best approach? Thanks!

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Dear Short Sale Home Buyer:

First of all when I do an initial meeting with my buyer clients - I explain all things associated with a short sale purchase to them so they are well prepared ahead of time and have no surprises and stress at the end.
Well, it's rather difficult to negotiate with the bank on repairs you have found in a home inspection, short sales are sold completely As-Is and banks do not want to make repairs on them as they are already taking loss on the lien and most of the times home seller(s) doing a short sale do not have extra funds to make repairs. Even then if you wish to negotiate on this with the bank there is no guarantee that the bank will accept it and of course it will further delay the approval.
Lender required repairs have a better chance of being taken care of by the bank/seller as every lender would need to have those repairs done or else the house will not sell, until or unless there's a cash offer on it.
My suggestion is that if you totally love the house and the repairs are not structural - go for it and have the repairs done one by one after you are settled (as you are the one who will make this house a home and shine it in your own way). And if that's not the case then try to get a release.

Hope this information is helpful to you and All the very best with you home purchase!!

Best Regards,
Faiza Alvi - Realtor®
Prince William Realty, Inc.
703-389-7973 (Direct)
703-580-9995 (Fax)
http://www.house2homeva.com
MILLION DOLLAR CLUB - PWAR 2011

I believe:
Real Estate is about building relationships
& serving clients with honesty, integrity & passion.
0 votes Thank Flag Link Thu Jul 26, 2012
The outcome of the scenario will be dependent on the sale strategy in play. As a buyer in the traditional concept of a short sale, you will be completely dependent of the listing agents infrastructure to pursue an outcome beneficial to you.
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There are way too many variables, one being if your lender will provide a mortgage without the repairs.
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Yes, repairs that have material significance (not cosmetic) can most certainly be negotiated.
However, as the buyer engaged in a typical short sale situation, you will be completely dependent on the listing agents infrastructure. It is frustrating and aggravating, but certainly in the realm of possibility.
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There are still a ga-zillion things that can go wrong.
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Remember the home owner is not your adversary in a short sale. Work collaboratively to reach agreement with the bank and have hope that the bank is negotiating in good faith with the home owner. This is the part you can not see but can prove to be the Achilles heel in an otherwise solid agreement.

Best of success to you,
Annette Lawrence, Broker/Associate
Remax Realtec Group, Palm Harbor, FL
727.420. 4041
Let's chat real estate on: http://www.RealEstateMadeEZ.us
0 votes Thank Flag Link Thu Jul 26, 2012
Even if the repairs are required by your lender, it depends if the seller is willing to make repairs. Short sales involve current homeowners experiencing financial problems who are avoiding foreclosure. Most short sale transactions we have handled involved sellers unwilling to put money into repairs for home inspection items. We've witnessed transactions canceled because financing could not be obtained by the buyer after the seller decided foreclosure was a better option than paying for repairs.

The bank is usually unwilling to reduce the price of the home after an appraisal has assessed a value to the house. Unless the repairs are structural (which should be noted by the appraisal) the buyer usually pays for the repairs in order to receive loan approval allowing them to take ownership on the home. The usual answer from the bank: Repairs are on the homeowner.

Dwayne and Maryanne Moyers
Long and Foster Realtors
Northern Virginia Realtors
Offices in Woodbridge-Stafford-Fredericksburg
0 votes Thank Flag Link Thu Jul 26, 2012
You can try to negotiate with the seller's bank a price reduction by showing evidence of the repairs needed, not all banks will consider your request, however you may not know it until you try it.
If you do have sucess in getting a reasonable discount on the price and have the money to do the repairs yourself you solved the issue, except if you are financing the home with a loan where the lender requires as a condition to do the repairs before clsing. Home owners themselves doing a short sale most likely will not cooperate in doing or paying for any repairs.
Good luck.
0 votes Thank Flag Link Thu Jul 26, 2012
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