Home Buying in Ann Arbor>Question Details

Ilana Hairst…, Home Buyer in Ypsilanti, MI

can I bid on more than one property?

Asked by Ilana Hairston, Ypsilanti, MI Wed Jun 30, 2010

I have bid on a short sale, my addendum gave the bank three weeks to accept, which hasn't happened. So, I have started looking at other properties and may want to bid on them, w/o withdrawing the current sales contract in case the bank accepts my offer.
My question is can i have two sales contracts, and withdraw from one the moment another comes through?

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Ilana,

One of my biggest frustrations in the industry right now is when agents don't properly explain and manage the expectations of buyers.

It is not possible to, "withdraw," from a contract. Now, if the proper protections are built-in, one may be able to, "terminate," a contract, but that can not happen unilaterally. Thus, it would require all parties to agree.

So, while I would never advise someone to potentially be in contracts on multiple properties ... I would first encourage that they are written correctly to begin with.
Web Reference: http://DoorToDreams.com
0 votes Thank Flag Link Wed Jun 30, 2010
Ilana,

As you can see from the other answers you can have purchase contracts on more than one home.

However, you want to think seriously about the strategy, including what office(s) have the properties listed.

For example, you may have a purchase contract on a short sale with a large listing office. Then a really desirable privately owned home comes on the market with the same listing office. You want to buy that home but you think there may be multiple offers. The fact that you already have a purchase contract with that brokerage may come back to damage your position on the privately owned home.

If you are working with a "designated buyer's agent" in a large office like that the broker becomes a dual agent and there is no telling what impact that could have on your negotiating position on a second home. (In Ann Arbor all the larger offices are designated agency offices. This is not the same as buyer agency where the brokerage and all agents represent you.)

It can get complicated, so take the time to think strategically before you make that second offer. It can sometimes make more sense to withdraw from the first offer first.

Good luck!
0 votes Thank Flag Link Wed Jun 30, 2010
Sure you can bid on other properties. Keep in mind you have an unaccepted offer, so there officially is no deal as most contract language is subject to final bank approval per terms of short sale acceptance letter issued by the investor. Make sure you have an out, in your contingencies just in case you find yourself with two accepted offers one day. There are other things you can do in conjunction with you buyers agent who represents you. If you are not working with a buyers agent, I work out of the Ann Arbor area and would be happy to further discuss your situation and provide other tips and recommendations. Best of luck!
0 votes Thank Flag Link Wed Jun 30, 2010
Keep in mind that short sales are by no means fast sales, therefore your addendum giving the lender three weeks to accept may be unrealistic. As for multiple bids--yes, you can bid on as many properties as you wish--however tread carefully as it can be extremely risky, especially if your bid(s) cannot be withdrawn--in that case will you be prepared to purchase more than one property--Your agent can best advise as it relates to your personal situation.
0 votes Thank Flag Link Wed Jun 30, 2010
Certainly, you can bid on as many as you wish as long as you understand the risks. What if you bid on three properties and all three get accepted with no changes? Can you close?
If not, then you must be very vigilant and withdraw two offers immediately when one of them gets accepted. If you are too slow you could be in trouble. In your case you are dealing with a bank, so the chances of them accepting your bid quickly are slim to none, so you probably have time to withdraw the second and third offers.
One solution might be to include language in your purchase offer that you agree to forfeit your earnest money deposit as liquidated damages if you fail to close as agreed. That way the seller is on notice that he will not be able to go after you in a lawsuit for specific performance at a later time.
0 votes Thank Flag Link Wed Jun 30, 2010
first thing it is unrealistic tio give a bank 3 weeks to accept, it is an impossible task even for the best or banks. the banks will not look at any date and say we have to rush, it could actually work the oppisistte as they look at the date and will know they can not get anything done that fast and not do anything rather than waste time, money and resources. Your offer is destined to fail before you even gave it a fair shake.

As far as making multiple offers, if you want to purchase more than 1 house at a time, make multiple offers, if they both get accepted at the same time, you are on the hook for buying 2 or more properties and can be held liable, you always want to withdraw your offer before placing another.

As far as the short sale process, once your offer is submitted, the bank has to assign a processor, the listing agent has to furnish a proposed hud, a net sheet, all the sellers financials, the buyers pre approval letter and a copy of their own bpo. The bank takes at least 2 weeks to process this, then assigns a negotiator, they will order at lkeast 1 appraisal and maybe a nother bpo as well, it takes 2 weeks at most to get these back (we are laready past your 3 weeks( Once everything is back to the negotiator, they assess if they have everything, if not they have to go back to the klisting agent for more info and if so, it usually takes 30 dasy for a decision, now this is best case. If the seller as private mortgage insurance or the loan was a fnma or freddie mac loan, they need to approve teh short sale which could be an additional 30 days.

Best cases are 2 months, average is 3 months and if everything is not sent the first time, it could be 6 months, so your 3 weeks is not enough time for a short sale.

Check out my blog

http://www.trulia.com/blog/scott_godzyk/2010/06/how_to_get_a…

TIPS ON GETTING YOUR SHORT SALE OFFER APPROVED
Web Reference: http://www.ScottSellsNH.com
0 votes Thank Flag Link Wed Jun 30, 2010
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