Home Buying in Southfield>Question Details

Cynthia Matt…, Home Buyer in Detroit, MI

what does subject to third party approval mean?

Asked by Cynthia Matthews, Detroit, MI Mon Oct 17, 2011

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11
In a sales contract is normally two parties, Buyer and seller. But subject to third party approval means that is another party involved in the transaction (generally speaking is the Bank or financial institution that holds the mortgage for that property).

Best of Luck,

Maria Cipollone

http://www.Flahomespecialist.com
2 votes Thank Flag Link Sat Oct 27, 2012
This phrase is commonly seen in short sale listings and usually means that not only does the seller have to approve the offer, the bank must also agree.
1 vote Thank Flag Link Tue Oct 18, 2011
Third party means there is another individual who owns some share who is not on title
0 votes Thank Flag Link Wed Mar 2, 2016
Subject to third party approval means the bank has to approve the sale and the sales price
0 votes Thank Flag Link Sat Mar 9, 2013
"Subject to third party approval" is a term used in transactions such as short sales where the seller can accept a buyer's offer subject to the mortgage holder's approval. A short sale is a transaction that allows a seller to accept less than is owed on a property when market conditions warrant a lower value. Short sales can sometimes be a good deal for a patient buyer.** The process can take a bit longer than a traditional buyer to seller sale. Your Realtor can explain the details and pitfalls on this type of transaction. T.K. Warden, Broker Coldwell Banker Seaside Realty
0 votes Thank Flag Link Thu Mar 7, 2013
THis is a very common statement with Short Sale. What it means is the bank is the 3rd party and the offer is contingent upon their final approval.
Hope this helps!!
0 votes Thank Flag Link Tue Oct 18, 2011
Third party means some one but owner,Normally owner's lander.Most of the short sales need this kind of approval.
0 votes Thank Flag Link Tue Oct 18, 2011
It means that you're possibly in for a long, long wait.
That 3rd party is probably a lender and you're dealing with a short sale.
Web Reference: http://www.321property.com
0 votes Thank Flag Link Tue Oct 18, 2011
As a "short sale" this simply means that the owner's lender must appove the actual agreed upon contract price for the sale to move forward.

Unless this is a "bank approved price" what often happens is that the transaction will move to a "second phase" of negotiations...between the lender and the buyer. It can result in the buyer being asked to pay more than the initially agreed upon purchase price negotiated between the seller and the buyer.

Hope this is helpful.

Good luck,

Bill
0 votes Thank Flag Link Tue Oct 18, 2011
Cythia - to add to Shanna's answer, often we see offers to purchase a home at the full listing price and the offer is turned down by the third party (bank). If you find a home that you really like and it is a short sale, it can be a good deal. Just beware - short sales can be very complicated. Make sure your realtor explains all the possibilities before you consider putting an offer in. Good Luck!
0 votes Thank Flag Link Tue Oct 18, 2011
Hi Cynthia,

It means someone besides the buyer and seller has to approve the offer/deal. This is usually the case with Short Sales. In Short Sales, the seller's lender(s) has to approve the sale after the seller accepts the buyer's offer. If the lender(s) doesn't approve the sale, the buyer can't purchase the home.

Shanna Rogers
SR Realty
http://www.RealtyBySR.com
0 votes Thank Flag Link Mon Oct 17, 2011
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