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Home Buyer, Home Buyer in California

Why would a seller of a short sale reject a fair offer? We offered several comps. They orignally accepted the

Asked by Home Buyer, California Sun Jun 15, 2008

offer and then while getting ready to sign the contract to send off to the bank, they wrote that they reconsidered the offer on the last page. What could the reason be? No other offers were made and no other reason was given.
They wouldn't profit from the sale so why not submit the offer to the bank....am I missing something?

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It could be beneficial for them to just stay in the house and let it foreclose. If they sell to you, then they really have to get out of the house and chances are, their credit is probably pretty bad at this point so finding someplace to move to could be difficult. If they dont sell to you and if there really are no other offers, they could simply sit back and wait for the bank to foreclose and then go through the lengthy process of formally and legally evicting them or even make a profit by getting the bank to give them cash in order to leave the property. It sounds crazy but I've seen it happen. People in financial distress can sometimes act emotionally rather than rationally...
0 votes Thank Flag Link Mon Jun 16, 2008
By "fair offer" I mean fair market value for the house we arrived at by using comparables. They were ready to accept it so I doubt it was an insulting low ball but something must have changed their minds.
0 votes Thank Flag Link Sun Jun 15, 2008
There could be a straw buyer in the picture (a straw buyer is someone who is close to the seller who is financially capable of purchasing the property with a promise to resell back to original owner at some point in the near future)

Lenders are aware of these and other kinds of practices by distressed sellers, which is why banks take so long to approve them.

If you're really interested in purchasing this property, I would schedule to meet with the seller and their agent to determine how you can proceed to assist the seller move forward with your purchase (you would be surprised what will make a deal in these times)
Web Reference: http://www.CorleyRE.com
0 votes Thank Flag Link Sun Jun 15, 2008
I don't understand either, unless I am missing something or if there are other reasons that we don't know. Personally, I would submit any offer to the lenders, even if I don't think it's going to go through. It will at least give me a starting point to talk to the lenders and that's what we need for a short sale - to at least get started in this long and drawn out process!

Sylvia
0 votes Thank Flag Link Sun Jun 15, 2008
Sylvia Barry,…, Real Estate Pro in Novato, CA
MVP'08
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