Karen,
Think of a short sale as as Seller side contingency. The Seller is making the transaction "contingent" on approval of the lender. The Seller signs the deal and it is contingent upon bank approval within a time frame that should be mentioned in the contract. The typical time is 45 days though most times there are several extensions of this as banks often take there time up to several months to get a short sale approved. Good Luck, there are a lot of good deals happening for patient people.

No, you must have signed contracts before the offer can be submitted to the bank. You will not get an approval even until you get a mortgage commitment. Short sales are tough but if you can stick it out you can get a good deal.

The seller does not need the bank's approval before he/she accepts the offer. As matter of fact the bank will not look at a Short Sale Deal until it has Seller's and buyer's Signatures along with Required Documents by the Bank.

In most short sales, the seller and the buyer come to binding contract before the contract is ever given to the bank - so the seller doesn't have to have lender approval before he/she signs the offer to make it a contract.

After it is signed and executed (again, in most cases) the bank will look over all the seller's financials, assess the property's worth, and decide whether or not the short sale will be approved. They have every right to deny the short sale, but in many cases, will allow a short sale to go through. If they do approve the short sale within the timeframe specified in the contract, the buyer is expected to inspect, apply for a mortgage, and purchase the home (pending all other contingencies.)

I'll attach an excerpt from a page on my website, http://www.sarasotapropertygroup.com. I hope it helps!

Alex Krumm
Re/Max Alliance Group
941-234-3597 Direct
941-954-5454 Office
alex.krumm@verizon.net

**SHORT SALES EXPLAINED**

The Pros:

> Foreclosures get foreclosed on for a reason. The best homes often sell before the bank takes over because they're attractive or in good condition, and the deal is irresistible to a buyer.

> Short sales are often currently occupied or are very recently occupied. Vacant homes often run into problems that are left unchecked because there's no one there to look after the home - dried seals in pipes, leaky roofs, etc.

> Banks make no representations about the state of foreclosed homes - they just don't know anything about the property. A short sale, which is still owned by the regular seller, often DOES have available information about the state of a home.

> Short sales can often be had at a fraction of the original sale price; get a Realtor to help determine an acceptable price (generally 85-90% of the fair market value)

> And, of course, you're helping the owner avoid foreclosure!

The Cons:

> Short sales take longer to work. Because there is a lienholder involved who needs to be negotiated with, it can often take several weeks to get a response from the bank. During this time, you are under contract and will be expected to purchase the home if the bank accepts your terms.

> It IS more work for the agent, but it's not any more work for you. Often this will turn agents off to short sales and you won't see some of the properties available; make sure you ask if your agent has experience with them!

The Myths:

> YOU ARE NOT RESPONSIBLE FOR THE SELLER'S LIENS. The price you negotiate with the bank will be your FINAL SALE PRICE, and the terms will be laid out in the contract. You're purchasing a home, not assuming a mortgage. This is also true for tax liens; the bank will pay them.

> SHORT SALE SELLERS ARE ALWAYS UNRESPONSIVE. Not true at all! Short sales are vastly superior to foreclosure for sellers, and most short sale sellers will bend over backwards for you - and if they won't, their agents will.

> SHORT SALES ARE REALLY HARD. Well, this one is partly true - but everything in life worth having is worth working for! 15% of our market is listed as short sales, and often these are the best properties available.

**The most important thing you can do to purchase or sell a short sale is to get an agent experienced in short sales.**

In all depends where the seller is in the short sale process. If it isn't an approved short sale, you're right - the seller is signing off on the offer pending the bank's approval or counter offer.