Home Buying in San Jose>Question Details

Sherry, Home Buyer in San Francisco, CA

Would bank give closing points on short sale property?

Asked by Sherry, San Francisco, CA Sun Oct 24, 2010

We are considering to buy a short sale property that bank have countered our offer. We will accept the counted price but would like to find out if we can ask bank to give credit for closing cost. We bought a REO last year where bank gave us 3% for these. Would bank do the same for short sale?

Thanks.

Sherry

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Sherry:

Short sales are quite different from REOs. In the case of an REO, the bank is paying for the costs and incentives, which is why these are offered. However, in an REO, the contract is between you and the seller (the distressed homeowner), and the bank's role is to approve the sale and the sale price and terms. Unless the seller has funds to pay for closing costs and other incentives, which most do not or else they would not qualify for the short sale, there is no money available for such monetary incentives.

So for short sales, the answer is "no" there is not money available for closing costs or fee reimbursements.

Sorry,
Grace Morioka, SRES
Area Pro Realty
Tel (408) 426-1616
0 votes Thank Flag Link Sun Oct 24, 2010
Hi Sherry

Yes you can counter their counter and ask for the same.
It maybe late in asking, you may have wanted to Mae it part of the initial offer.

In a short sale a bank has to run a Net Sheet, if there is more than 1 lender then both are affected.
It maybe a stretch now.

Let us know how it goes.

God luck.
Perry
Web Reference: http://ruthandperry.com
0 votes Thank Flag Link Mon Nov 1, 2010
With short sale, most of the time there is no money to give back, so it is a "no". If you ask which is a re-counter then it could prolong the closing or could end the contract, also it depends on the bank loss mitigation dept. A risk that is your choice to make.
0 votes Thank Flag Link Sat Oct 30, 2010
Sherry,
I completely agree with Grace usually on a short sale the seller has no money to cover closing costs so the bank has to pay for that, so they are very unlikely to give you anything back, but there are always exceptions to the rule I am about to close a short sale where we did get 2% for closing costs on an FHA loan so it is not impossible, but usually the answer is no.
It all depends on how good the agent is in working with the short sale negotiator, how well is the home priced, how many loans on the property, how many bids on the home,how competitive was your bid, etc.
I hope this helps,
Allyson
408-705-6578
allyson@homesbyallyson.com
DRE# 01397256
0 votes Thank Flag Link Mon Oct 25, 2010
The answer is IT DEPENDS. I had a short sale with @#*& (I cant disclose the name of the bank) and they approved $2000 for closing cost and others they will not give anything for closing cost. If you want a bank to give point always ask for them in the contract and have them in estimate HUD1, so when the negotiator is calculating the #s there will be a good chance you might get it. Sometime some negotiators will allocate certain amount of $$ to go towards anything and that could be used for buyer’s closing costs.

I hope this helps!
Web Reference: http://www.homesbyzaid.com
0 votes Thank Flag Link Sun Oct 24, 2010
It sounds a bit late in the process. When they counter, they are giving you numbers they will accept. This is very close to an accepted short sale. If you originally offer with requests for costs for closing, it is then submitted with the original paperwork.

When you counter offer (if you ask for something else other than accepting their counter, it is countering their offer) they will say yes or no.

I would not say your chances are particularly good. Better to include in original offer. However, a counter offer breaks the contract so you are free at this point to walk.
0 votes Thank Flag Link Sun Oct 24, 2010
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