Home Buying in 94105>Question Details

Leigh, Home Buyer in San Francisco, CA

Short Sale question/advice -Pro & cons of havinghome inspection done before bank negotiates a final settlement

Asked by Leigh, San Francisco, CA Thu Apr 9, 2009

I'm in the process of a short sale and we have been advised to have the home inspection done before the bank negotiates a final settlement so we can still negotiate with the bank. I wonder if other have done this and what are the pros and cons of doing this?

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Great question Leigh. The pro would be being pro active so 1. You might save a lot of time not waiting around if the bank decides not to sell to you at your price. 2. To try and negotiate prior to the bank making the final decision so you have leverage with the inspections.

The Con, Again, it might give you leverage having the inspections done prior to getting the decision from the bank, but the bank may not honor your price. If this happens and you connot come to an agreement, then you spent money on inspections that you cannot recoupe.

Getting the inspections done prior to the final negotiation is a small investment, but also an attempt to save a ton of time.

FYI, I am in the middle of exactly what you just asked. We made an offer and while we were waiting for the lender I asked the listing agent if she had any inspections prior to us making an offer, even if they were the old ones when the seller first bought the home. We found the pest inspection and we able to reduce our offer by another $15k. We close escrow in two weeks.

Good luck, if you can afford the inspection money, go for it.

Dave Tap Tapper
Cashin Company
Web Reference: http://www.TeamTapper.com
0 votes Thank Flag Link Thu Apr 9, 2009
Hello Leigh,

I would recommend doing a home inspection. Make sure that the listing agent includes any items that need to be fixed or replaced in the Net Sheet/Hud1 that gets submitted to the bank. Every short sale bank has required a Net Sheet/HUD with every single offer. These are also used when they submit their terms to escrow so it is very, very important to have everything correct before submittal to the bank. If they are not correct in the first place it may delay time periods of getting approved substantially.

They can either say yes, no or negiotiate on every item so why not try to get the most.

Best regards,

2 votes Thank Flag Link Thu Apr 9, 2009
Good answer David that sums it up.
0 votes Thank Flag Link Tue Apr 14, 2009
I would not invest a dime in the propertry until the lenders agree to short sale the home. Short Sale FAQs can be found belo. Good luck!
0 votes Thank Flag Link Thu Apr 9, 2009
The Hagley G…, Real Estate Pro in Pleasanton, CA
Yes, get the home inspection BEFORE a final settlement. Help in the negotiation. Also, be prepare to wait it out....short sales can take a long, loooong time.

I hope this helps.
0 votes Thank Flag Link Thu Apr 9, 2009
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