Sue-

I feel your fustration as I buy short sales as an investor. Listing agents will lower their listing prices substancially in order to attract offers. This is justified because without an offer on the table the lender will not consider a short sale and will foreclose. So, the listing agent is just trying to help their client avoid this catastrophe.

Moreovrer, the listing agent or your agent should have informed you that the sale price is contingent upon lenders acceptance. They should also have informed you that the lender will base their price on a BPO (Broker Price Opinion) or Appraisal. Typically, the lender will use the BPO as a starting point in their negotiations and you can usually knock off a 10% or so for the foreclsoure and carrying costs they would incur.

I feel that the listing agent failed to communicate with you and the lnder which is very typical as agents really are out of their element. Most agents experience lies with a two party transaction (seller/buyer) and are unable to effectively manage a short sale. I no longer use agents and I actually handle short sale negotiations for both agents and other investors.

My last comment is the success ratio mentioned by Paul. Personally, my sucess is in the 60% range. The reason for this is there are many ways to manage an effective short sales transaction, but generally speaking, agents do not have the neccessary time or skill sets. I have the time and have the ability to see the transaction through. If your still in the market for a short sale, give me a call and I will give you some free tips on how you can improve your chances on a successful short sale.

Hi Sue,

Welcome to the world of short sales. And yes, most, if not all, short sales have a listed price which is just an advertisement that can be viewed as "bait & switch." For one thing, the listed price on short sales is rarely ever approved by the seller's lender(s). It's just an advertised price that the listing agent puts out there in hopes of getting offers. Besides, even if the listed price was "approved," the bank hasn't agreed to the buyer's unknown terms & conditions. Short sales have a 10% success rate of selling if there is only 1 lender involved & about a 5% success rate of selling if there are 2 lenders involved on the seller's side and with most short sales taking 4 months or longer to close, they are just not the best option for most buyers.
Also, if you did not have a Buyer's Agent Realtor assisting you and went directly to the listing agent, your frustration would have been avoided if you were properly represented by an experienced, full-time Buyer's Agent Realtor.
Click the link below for more info on short sales.

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PAUL WELDEN
Buyer's Agent Realtor
HomeSmart
480-241-0081