Home Buying in Cincinnati>Question Details

Beth, Home Buyer in Fort Myers, FL

what is the difference between "bank approved short sale" and a short sale.?

Asked by Beth, Fort Myers, FL Fri Jul 31, 2009

We bid on a bank approved short sale, 165K 2 months ago. We want to know since it had a approved price is this a slam dunk, once they get to our file or is there still a danger of losing this property. This is in Ft. Myers Florida, we have gone through this once before, it was not a bank approved, it went into foreclosure and the owners had to declare banckruptcy. We have asked our agent to spell out the difference and for some reason she will not reply.

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5
All good answers. I just wanted to add that on a bank approved short sale there has to be an accepted offer between buyer and seller. The bank will then require a HUD 1 statement to let them know how much money they will be receiving from the sale. They also want to know if there are any contingencies such as seller paid closing costs for the buyer etc. They will then decide to accept or reject the offer. Both agents need to stay on top of the paperwork so that the deal proceeds smoothly. I've been in a contract where the selling agent didn't realize there was a second mortgage on the property until 4 days before closing. This took further negotiations with the company holding the second mortgage and almost prevented the deal from happening. Just be prepared for something strange to happen and don't expect the deal to close quickly. It can takes months or sometimes won't happen at all. Good Luck..
0 votes Thank Flag Link Sat Aug 1, 2009
Beth
In a short sale the seller is disclosing that the proceeds from the sale will fall short of the required closing costs. Most lenders will not start the short sale approval process until they have an offer. Many times that means that if you are the first accepted offer, THEN they start the approval process., it could take a long time for them (six months) to approve the sale.

So when you say "approved short sale", I would assume that the process will proceed at a more normal pace (a month or two).
0 votes Thank Flag Link Fri Jul 31, 2009
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
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Beth,
Looks like TJ and Beth have both provided good answers. My understanding of 'bank approved short sale' is that the lender has told the owners a number that they would be willing to accept on the sale of the property. Whereas a 'short sale' inplies that the seller is willing to accept less that they owe on the property, but they do not have from the lender, the dollar amount that the lender would be willing to accept on the sale.
0 votes Thank Flag Link Fri Jul 31, 2009
Huh well beth,Approved shortsale simply means the bank has agreed to accept a shortsale,and a short sale is simply that the bank is willing to take less $ than owed.Be prepared to wait and could all be for not.I say this cuz if the listing agent is not knowledgeable on how to properly fill out paperwork etc... it wont happen.Good luck sounds like a decent amt for down there,but there is nothing short about these lol.I hope it works out for you.Cuz the reason banks agree to a short sale ,its cost them more money to foreclose.

Regards;

TJ
0 votes Thank Flag Link Fri Jul 31, 2009
A short sale situations exists when the seller owes the bank more money than the asking price for his or her home. If it is a bank approved short sale than the bank is ready and willing to accept the asking amount. Often times a bank will not approve a short sale until they have a verified offer which the seller may accept but the bank may not.

Susie Ripp
Coldwell Banker
0 votes Thank Flag Link Fri Jul 31, 2009
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