Home Selling in Mankato>Question Details

Mary Jo Mick…, Real Estate Pro in Mankato, MN

NEED ADVICE FROM FELLOW REALTORS ON A SHORT SALE SITUATION

Asked by Mary Jo Mickelson, Mankato, MN Tue Mar 16, 2010

I am a buyers agent on a short sale. Seller accepted my buyer's offer. Offer was submited to lender. Lender replied today that would accept offer, but, they will only pay 3% in closing costs. My buyer accepted that, but then modified the asking price to cover the difference in CC that lender is not paying. Seller now says Buyer has changed the terms and wants to accept another offer that has come in. Is this offer considered accepted? Can seller (homeowner) make this decision after lender has responded?

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Mary Jo, In addition to your changing the contract which allows the sellers the opportunity to back out. Also by changing the Sales price to reflect the decrease in Seller Paid Contributions to the 3% the bank requested will also trigger the bank to have to re-accept the changes in terms as well if outside of thier Preliminary HUD values. Which would mean delays for your buyers as well even if the sellers choose to amend the contract.
Web Reference: http://www.cdpe.com
0 votes Thank Flag Link Wed Mar 17, 2010
Yes, it would need to be in writing. Can you have your broker make a call to your office attorney. Run it by him/her and follow through communicating it to the listing agent. That may be the fastest way to quash this issue with the seller before the deal blows up and your buyer gets really upset.
1 vote Thank Flag Link Wed Mar 17, 2010
Hi Mary Jo,

(Love your name)
The seller signed the orginal offer the buyer sent with the original terms including the closing costs listed in the PSA. The deal is fully accepted and deemed an agreement.....until your buyer changes something. Once he makes that change all parties have to agree, therefore, until it's signed around again, it's not an agreement.

The seller can accept or deny the new terms. In other words, I do believe the seller can refuse, it's ultimately up to the seller as it's their credit and defiency loan amount in negotiations.
1 vote Thank Flag Link Tue Mar 16, 2010
It is not uncommon to have lenders communicate Orally (via email too) regarding terms so when the final agreements are placed in writing there is only one g0 round for signatures.

Looking at your market stats it appears that you have a downward trending market in terms of values, is that correct? Balanced from the inventory standpoint, or is it seller's market?

Your buyer needs to know the type of market. If months of inventory is below three months (which might be the case here with 450 homes for sale and 260 homes recently sold) then your buyers need to be aware that the sellers can "make the rules".

Good luck.
0 votes Thank Flag Link Thu Mar 18, 2010
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
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To me a counter-offer or offer is not in existence until it is in writing. If this is a verbal the seller does not have grounds to walk on the deal. Verbal offers don't typically stand up but in some cases they do. However if by verbal you mean e-mail, this form of communication can be an acceptable form of written change to the contract in some case studios. This makes your situation a little difficult. Good luck, talk it out wth your broker. This may be a slippery slope or it may be just some tough communication is necessary with the other agent. Determine your best action and move forward. I know I would choose the Tough communication with the other agent. Again Good Luck!
Web Reference: http://mnrealtor.com
0 votes Thank Flag Link Wed Mar 17, 2010
This is Mary Jo. I posted the question. I guess my biggest question is this: IT WAS VERBALLY COUNTERED. We have NOTHING IN WRITING changing ANY original terms! Wouldn't our counter have to be IN WRITING to the seller before seller can deem it "changed"? Verbal means nothing in countering...... Please answer again if you already have on this portion of my question. Thanks!!!!!
0 votes Thank Flag Link Wed Mar 17, 2010
It seems that seller is right about their move. Since buyer want to change the sales price. In my expirience, Short Sale approval is based on the original terms with the Lender changes. So buyer changing the price will require lender to change the short sale approval.

Buyer and seller agreed on a sales price, not buyer is not.

Benito.
0 votes Thank Flag Link Wed Mar 17, 2010
Seems to me that the seller has the right to do this.
0 votes Thank Flag Link Tue Mar 16, 2010
Cindi Hagley,…, Real Estate Pro in San Ramon, CA
MVP'08
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You are obviously in a competative market just like here in SoCal. All of the banks are only paying 3% and it could be that the seller is worried about the home appraising. Unfortunately there is not much wiggle room for buyers to try to negotiate. In this market sellers commonly threaten with accepting another offer!
Web Reference: http://www.soreal.biz
0 votes Thank Flag Link Tue Mar 16, 2010
Yes, your buyer counter offered. The seller can accept any other offers until both parties agree on terms. Just an FYI, even if you buyer decides to up the price some lenders will only pay a certain amount towards buyers closing costs (ie., 3%)
0 votes Thank Flag Link Tue Mar 16, 2010
Mary Jo
Yes, if you change the terms outside of the agreement. It is the seller who is signing the RPA and then submitting to the bank. It needs all hands shaking to make it happen... Seller, Buyer and Bank. They want it to go smooth and the bank has already agreed to specific terms. Now they want it done and over. The bank can make it very difficult and they generally want a clean fast close once agreement has been made. But... that is the nature of the beast.

Good Luck!!!
Web Reference: http://www.di4homes.com
0 votes Thank Flag Link Tue Mar 16, 2010
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