Brian, It sounds like the bank had not foreclosed on the property when you submitted your offer. If your agent submitted a "complete package" with your offer (Offer, Short Sale Addendum, pre-approval letter, proof of funds to close, copy of deposit check, FICO scores) you have a good chance of the bank postponing the foreclosure.

However, ALOT depends on the listing agent and the list price. A full price offer does not necessarily mean that the bank will approve that amount. The bank will do a BPO (Broker Price Opinion) which is a mini appraisal. Based on the value of the BPO, they will determine whether or not to accept your offer.

The listing agent MUST submit a complete package to the lender all at once. Depending on the lender, this will include a letter of explanation from the owners along with their financials, tax records, etc. The bank has to approve 2 things: 1)Do the current owners "qualify" to do a short sale (hardship) and 2)What price will be approved. Along with that, the listing agent must be in contact with the Default Department with the current lender to work on postponing the Trustee's Sale. He/She cannot assume that the Short Sale Negotiator will be in contact for him/her.

Assuming ALL THAT works in your favor, you enter escrow. Keep in mind that all lenders are different, will require different things, and have different time frames but most will not pay for termite, zone disclosures, or home warranties.

Hope this helps.

When a house is foreclosed upon, the whole process starts again.

In a short sale, the owner (seller/individual) has put his/her property up for sale. There's a listing agent, just as in any other real estate transaction. If a buyer comes along, as you did, and makes an offer, the seller can accept, reject, or counter the offer...just like a "normal" sale. (Realistically, the seller won't often reject or counter; he/she just wants out and knows he won't receive any money, regardless of the sales price.) The lender's only role is to approve or disapprove the agreement between the seller and the buyer.

Now, when the property is bank owned--after foreclosure--it's a whole new game. Now the bank is the owner. The former owner (and the former agent) are out of the picture. There's a new agent, generally one who specializes in REOs. And now the bank receives offers, can counter the offers, or can accept or reject them.

Once the foreclosure occurs, a short sale is no longer possible.

As for your question about receiving an answer quickly: If you're talking about your short sale offer: No. As noted above, once the bank owns it, there's no more possibility of a short sale. If you're talking about making an offer on an REO: Maybe yes. I've heard that, generally, banks do act more quickly when the property is an REO than when it's a short sale. I'm sure, of course, that that varies by lender.

Your Realtor should be able to help you.

Good luck.

It sounds like the home hasn't been foreclosed on yet. If the listing agent has good communication with the lenders (first, second or what might be the case), you might still be able to get the property through the short sale. Technically the Seller is the one who needs to accept the offer, but the bank needs to approve it. In most cases banks/lenders prefer to sell properties through short sale. Once property becomes an REO, it become a liability for the banks - the average cost of foreclosure costs lender about $50,000 in fees, maintenance.... If your offer is full price and your loan can be processed quickly, and if the listing agent has a good communication with the lenders, you should be able to get this property through short sale. The lenders can usually delay trustee's sale...

When you say turning over to the bank. are you referring to the sherrif's auction? I've been able to stop and/or delay the auction process with a short sale offer. If it's a reasonable offer, and the listing agent knows what they are doing, they should be able to get the short sale through - good luck!

I'm not clear in your description if it has been foreclosed on yet. Did the foreclosure sale take place? If so, the short sale is no longer a possibility. It will be back on the market with a new listing agent in a week or two as bank owned, maybe cheaper. If so, be prepared to make an offer quickly. By "turning over to the bank this week", you mean it hasn't been foreclosured on yet, there is a slight chance for a short sale still. Banks don't move quickly and they won't be pressured, so it's within a week of the sale they may not postpone the sale date. Plenty of bank owned properties in Vista to choose from but it is very competitive with multiple offers on most of them. Good luck!

Diane Conaway, RE/MAX United

Brian,

Have your agent check with the Loss Mitigation Dept. and the bank. Though the bank must complete the proper actions to bring it to the Foreclosure Sale Date they are not required to act on that date. They have just completed all the necessary requirements.

Often, if they know that your offer to purchase is still alive, they will forstall that date and close with you.

Remember, they have to figure out what the net to them is going to be.

In the foreclosure process all those 2nd mortgages and leins are erased. If they do not perform the Trustees' sale those items remain.

Association liens, sewer liens, tax liens, mechanics liens, etc.... oh and the 2nd mortgage.

They will often, especially if the Seller has an IRS lien, need to negotiate with the Seller to get him to take that off or decide if the net will be better for the bank than taking the property back and trying to resell it in the open market.

Hope that helps.

Get your agent to contact the bank. There is a good chance that there will still be time, after the sale date, to get it closed for you.

Brian,

I agree with Walter. This doesn't sound promising

Hi Brian,
In my opinion it doesn't sound good. The listing agent has a contract with the previous owner. Once the bank forecloses they become the legal owners. The current listing agreement is no longer valid. I believe this will become a REO transaction not a short sale transaction. Also beware that the property isn't sold at a trustee sale on the court house steps. Best of luck, Walter