Home Buying in Santa Rosa>Question Details

Wheels6, Home Buyer in Santa Rosa, CA

i am disabled and have been living in a property for 12 years that is now in a short sale. my mother made an offer of 71,000 and she is pre approved.

Asked by Wheels6, Santa Rosa, CA Fri Aug 13, 2010

there is also a 70,000 offer that is all cash. the sellers realtor said they accepted the other offer because she didnt think that my moms bank would approve the loan once they appraised the home and saw that it needs some work. i am afraid of losing out on this home that i love.

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I am unclear as to whether you are the current owner of the property, or renting there. If you are on title as owner then you should get in touch with someone about the Obama new efforts to keep people in there home. In Santa Rosa, CA, the CRLA agency is doing home counseling. If you are currently renting, I wouldn't think there would be anything to prevent your mother from making an offer. But yes, it would have to be higher than the cash offer, and the house would have to be in good enough condition for the appraisal and loan underwriters to approve. If you are a tenant,I would recommend that you find someone that gives tenants counseling about their rights. There is also a very good agency for people with disabilities in Santa Rosa called DSLC, I think it means "Disability Services Legal Center", they have many services and attorneys that volunteer to give advice. Best, Terry Bell, Realtor, CPS Real Estate, Santa Rosa, 707-292-5712
0 votes Thank Flag Link Fri Aug 20, 2010
You need to be aware of the Arms Length Law when dealing with short sales which prohibits relatives from buying the same property. However, having said that..it doesn't mean people are doing it. I highly doubt the bank will pick your moms offer over the all cash one which is pretty close to what your mom is offering. Perhaphs if your mom was to offer a bit more, it might work. Just don't give up and discuss all your options with a knowledgable Realtor. Good luck

Kamal Randhawa
Broker
510-932-1066
0 votes Thank Flag Link Fri Aug 13, 2010
These days, the property has to qualify for the loan, not just the buyer. So depending on what repairs would be needed, the realtor is probably right. It remains to be seen if the bank approves that price anyway, you understand. They may well come back and demand $125,000 or some other price no one is willing to pay at this time. You just never know what direction a short sale will take. If you want to know about other options you might have, just send me an email me asking. I’ll be glad to chat. Thx, cj
0 votes Thank Flag Link Fri Aug 13, 2010
Have your mothers offer placed in back up position since it is not uncommon for a buyer to grow tired of the time and process involved in a short sale and they might just back out. It at least has you in a position to get the home you love should the present buyer bow out.


Best wishes.
0 votes Thank Flag Link Fri Aug 13, 2010
In a short sale, the bank does not allow a sale to any relative. They will ask you to sign a form in most cases stating you are not selling to any relative. A short sale is not the answer if you wanted to keep your house. you should have tried a loan modifciation to keep your house.

A cash offer is always better than an offer that requires financing, however as the seller you can not be forced to sign any offer. If your mothers offer was first you should have only signed one offer and that have been submitted to the bank for approval without a wait. The cash offer could be a back up offer and not submitted if you already signed one offer. you can not sell the house to two different people, so you should not be signing more than 1 offer. Most banks can only look at 1 offer at a time anyway, you still own the house, the bank simply decides if they will reduce what you owe to allow you to sell it.

please see my blog for more tips on getting a short sale approved.
0 votes Thank Flag Link Fri Aug 13, 2010
If you want to keep your home--consider consulting with an attorney who specializes in real estate sooner rather than later--and see exactly what options you may have--in a short sale the transaction needs to be arm's lenght--unrelated parties--an affidavit from the lender will need to be signed, and if violated it could result in mortgage fraud. Again consult with an attorney, as other options could be available-- most professionals do offer a free consultation.
0 votes Thank Flag Link Fri Aug 13, 2010
What they're telling you is they don't want to roll the dice with an appraisal because it is likely to appraise for LESS than $71,000. In other words, it's overpriced. Add to that the cost of making repairs, you're looking to get yourself in over you head with this particular house.

Is there any chance the other buyer is buying this as an investment and will let you continue to rent? If not, maybe you're meant for something better.

Best of luck!
Stacy Carter
0 votes Thank Flag Link Fri Aug 13, 2010
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