Home Buying in 55306>Question Details

Bbqgal, Home Buyer in Vancouver, WA

Should we count on the listing agent?

Asked by Bbqgal, Vancouver, WA Fri Apr 25, 2008

We recently put an offer in on a short sell. (closing day is set at May 26)The listing agent told us it takes the bank 3-5 days to make a decision. I was really impressed. (I know most people are experiencing 40-60 days. ) We put the adjusted offer in after we were told that there will be no contribute from the bank and no contingency of inspection. 3 days later, the listing agent told our agent that the seller is out of town. Here we are at day 10 and don't know what to expect. I know it's way to early to worry about anything. My question is:
1. Should we ask our agent to push the deal or should we just ride along? (We do want to settle in a new house hopefully by June.)
2. At this point, is there anything we could do to help push the deal through?

I know there are many experts here who might have few advice to spare, please feel free.

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Answers

9
Regarding short sales and your experience....

First, no agent can with any confidence predict how long it'll take for a lender to approve a short sale. You're lucky if it's 45-60 days. An agent who says 3-5 days is...well, let's be charitable and say inexperienced.

Second, on a short sale, the bank is a contingency. Your contract is between you and the seller. If the seller signed the contract, it doesn't matter if he/she isn't available. (And the listing agent should have gotten a limited power of attorney from the sellers, just in case.) On the other hand, without the seller's signature on the documents, you don't have a contract and most lenders won't even look at the paperwork. So you've got to clarify whether there's a ratified contract (between you and the seller). That's what should have been submitted to the lender.

Yes, you should push your agent. Actually, your agent should, in turn, push the listing agent, who will work with the seller to make sure that the short sale package is properly completed and submitted. And the listing agent should be calling the lender every day or two to make sure that all the paperwork is there. (Lenders all too often misplace one or more documents. And they won't take a look at the package unless all the documents are completed.)

You say you're at day 10 and don't know what to expect. Your agent should have fully briefed you on the entire process, so you'd know exactly what to expect. Basically, expect to be in limbo. The lender could act tomorrow (unlikely), or the lender could sit on your offer and let the property go to foreclosure. Yes, that happens. There is absolutely no assurance that your offer will even be acted on, and if it is, it could be rejected or countered.

Oh, and make sure all your financing and other paperwork is lined up. If an when the lender finally says OK, you may have 10 days or less to make it to closing. Otherwise, the deal can become null and void.

That's it in a nutshell. Hope that helps.
2 votes Thank Flag Link Fri Apr 25, 2008
Don Tepper, Real Estate Pro in Fairfax, VA
MVP'08
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So, is the contract signed by both buyer and seller? That determines where you are at in the process.

I don't understand the "out of town" excuse. I have communicated with and transferred documents all over the states and the world. We live in an age where that is accomplished with ease.

Perhaps your agent can contact the listing agent's broker since there seems to be a lack of experience on her part. Perhaps some coahcing would move things along. That provides no guarantee, though. If the hold up is really the bank, that ....you must just accept...or withdraw your offer and walk away.
1 vote Thank Flag Link Sun Apr 27, 2008
Deborah Madey, Real Estate Pro in Red Bank, NJ
MVP'08
Contact
You're in a siuation that dictates that you for the most part, have to ride along. The Seller needs to sign the PA prior to the bank, so my suggestion is for your agent to get the listing agent to get the PA to the Seller somehow. They can likely be reached by fax or e-mail anywhere they may be. After they sign, then have your agent be in constant communication with the Seller's agent, and get the PA to the bank and get them to make a decision. Michael's point is a good one though, the bank can reject and simply foreclose.

Thanks, Todd Norsted
Web Reference: http://www.toddnorsted.com
1 vote Thank Flag Link Sun Apr 27, 2008
Keep in mind with a short sale the bank can reject all offers and foreclose. if it's being offered "subject to bank approval" the bank may not approve and foreclose to protect their asset.
Michael Doyle Realtor
1 vote Thank Flag Link Sat Apr 26, 2008
I agree with the other agents. One thing not addressed though is your comment that you want to settle in a house by June. In my experience, short sales are not for buyers who have a time frame to purchase. If you truly wish to be in by June, I would think twice about getting involved in a short sale. A normal transaction will take you (approx.) till June as it is, and as you said yourself, short sale generally take 40-60 or even 90 days.
My second comments are about the mention of no contingency of inspection. I do not know what state you are in, and standards of practice do vary state to state. But even if the house is being sold "as is", you should still have a contingency based on your attaining a professional inspection. If the bank or seller do not wish to be responsible for making or paying for repairs, you should still be protected in the event there are major repairs needed on the house, ie. roof, structural, etc. After receiving the inspection, you should have the choice to take the house "as is" and be responsible for any repairs yourself, or cancel the contract if you find major damage to the property that you do not wish to be responsible for. I am a Realtor in Florida, and that is how it would be handled on our FAR (Florida Association of Realtors) contract.
Web Reference: http://robpailes.com
1 vote Thank Flag Link Fri Apr 25, 2008
A short sale is really up to the bank to accept or reject and can take months. If the bank gets back to you in 30 days, be glad! Many banks believe they should finish the foreclosure process since they already incurred lawyers fees and more at the sheriff's sale. Short sales take a lot of work and most agents are willing to do the follow up needed to get it done.
1 vote Thank Flag Link Fri Apr 25, 2008
When it comes to a short-sale you negotiate with the bank. The Seller has to sign the contract yet the final decision maker is the lender that holds the note. Depending on who you are dealing with it can take several weeks since there tend to be not enough "lost-mitigators".

In this case the Selling agent is the only one you can deal with since the bank will not talk to you about it. Your Buyers agent should really do all the work. There is up to 6% in commission there and if you do not have representation the agent on the seller side should be Super Motivated since, if applicable in your state, Dual agency and collect commission from both sides. I would call the agent Every Day!! Good Luck! / Anette
1 vote Thank Flag Link Fri Apr 25, 2008
I also concur. A short sale is not for those with a timeframe. Banks are very slow to respond and won't be pushed or bullied too often into an answer. If I was your agent, I would set a deadline for yourself, pull the plug and move onto an owner occupied regular home or a full foreclosure home (past short sale). Working in MN, that is how I would handle it.
0 votes Thank Flag Link Sat Apr 26, 2008
Thanks a lot guys!

Robert,
We are in MN. "Settle by June" is our wish but we know it might take longer than that. With 18% sales nation wide is short sale amount all houses on the market, how can you not to get into one?!

The inspection part smelled very fishy to us. (We still suspect that was not banks idea) Anyway, thats why we adjusted our offer and went back for a third look before we submit our offer. Our biggest concern is like everyone said, because the listing agent is not experienced, she put all those terms herself. Including no inspection and no seller contribution. Later on she found we lower the offer by 26k and don't know how to explain to the bank what had happened. If thats the case (cross finger and hopefully it is not), can the listing agent hold off the offer and come back two months later and tell us that the offer is rejected?
0 votes Thank Flag Link Sat Apr 26, 2008
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