Foreclosure in 32703>Question Details

Mary, Home Buyer in Altamonte Springs, FL

Trying to buy a shortsale, would a phototour/repair list of repairs needed help?

Asked by Mary, Altamonte Springs, FL Sat Aug 30, 2008

The bank is still trying to get top value for a house that is foreclosing in Nov. We are trying to buy the house for 150k and the bank is wanting 185k. If we did a phototour of all the repairs it needed, plus a repair estimate, do you think this would help? I don't want to waste our time if the bank will probably not even look at it. Some general stuff the house needs is:

new flooring, garage door, appliances, patio wall, major yard repair (taking out large trees and general landscaping) light fixtures, and cabinet repair.

Does anyone have any advice an how to successfully complete the list so the bank would consider it? Should it be printed pictures or on CD ROM? Should we submit the photos with another offer slightly higher, say $156k to help get their attention?

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Answers

11
Hi Mary,
All these answers are good. The main thing to remember when you are buying a short sale: It is a Pre Foreclosure and you will be buying it AS IS. You’re Real Estate Agent or Realtor should be doing the leg work on this, running the comps, doing a BPO etc to see what the true value is. Then he can make his own estimate of work costs that need to be done to come up with your offer. All that needs to be submitted with your offer.
Now, when we list homes as short sales there is a huge amount of paperwork that we need to get done and submitted to the bank. One of these forms is a Repair Checklist, documenting what repairs need or should be done to the subject property. The problem is that if the listing agent did not supply the bank with the Repair Checklist the bank assumes the property is AOK. The banks (usually) are not local and will not see the property. They will eventually send out for an appraisal, once they have a reasonable offer.
I am not a Short Sale expert, I have done several and I am still working on a few and if someone says they are a Short Sale expert, run as fast as you can away. In this market the banks change the rules like the weather in New England. :)
Be Careful, Be informed and be represented
Paul Antonelli
2 votes Thank Flag Link Sun Aug 31, 2008
Sorry Mary, you posted while I was typing. Your dilema here is the Listing Agent and unfortunatly, your Realtor can only sit back and wait, unless, your Realtor can do one of two things, convince the LA and the seller, to speak with the lender on their behalf or motivate the LA to get on the ball. Other then that, I would guess you will need to wait until it is a foreclosure, as there is some definite, but usually simple, work to be done on this file
0 votes Thank Flag Link Mon Sep 1, 2008
35% is exactly why I consider myself an expert, because me and my team close over 90% of all short sales. This is exactly why I posted on here several weeks ago about paying a referral fee to anyone who didn't want to handle short sales.
Mary, I didn't notice your last question. Ask your Realtor if what you offered originally was a Fair Market Value offer or close to. If it is, then I wouldn't recommend going any higher. If not, I would have to run the numbers to see what it is really worth, so there are many variables here that won't allow me to give you a solid answer, BUT I would wonder why you want to prove it is worth less, by sending in repair pics and quotes, and then offer more then the original offer. You just played right in to the banks game. Good Luck
0 votes Thank Flag Link Mon Sep 1, 2008
To help with what I'm dealing with here I have a couple of things to add.

My husband and I do not NEED to move, we have all the time in the world.

I have a realtor who has been up the listing agents @$$ for 2 months. The listing agent seems unmotivated, and the bank seems even less motivated.

When the house was ORGINALLY listed and appraised, it had a hot tub, new appliances and an actual patio wall. The owners ripped out all three and took them with them. I'm not even sure the bank is aware of this, again the listing agents motivation.

We would love to get another BPO to support what the house is like now, not when it was in top condition.

The bank is basing their case strictly on comps from the area. Of course those houses are move in ready and this one is not.

I'm almost certain the listing agent has not given the bank any idea what kind of repairs this house needs. While cosmetic in nature, still is going to cost a buyer 10k to 20k out of pocket.

Should I just wait and try again once it's actually a foreclosure? We're so frustrated with the whole process we don't care if we get the house or not. We did fall in love with it but we're not stupid enough to pay top dollar for this house (or any house in this kind of market!)
0 votes Thank Flag Link Mon Sep 1, 2008
I bet less than 35% of short sales go through. I have seen closer to 9 out of 10 do not close. The bank really has nothing to gain from a short sale but plenty to lose. many loans are insured through private mortgage insurance as well as many home owners have 1st and 2nd mortgages as well as back taxes and condo fees and maybe some mechanics liens. These can only be cleared by foreclosure, In a short sale they have to be paid. When a property is discounted by the bank, they usually gove you the figure they will accept, they almost never come down from it, they already take into consideration the property needs work. All of those items should have been submitted with your original offer. I always encourage a written letter, estimates from contractors, and details of repair work and of course lots of pictures. the listing agent should have had you include this. Good Luck mary but it may be too late. You can always try though if you have time to wait for an answer.
Web Reference: http://www.ScottSellsNH.com
0 votes Thank Flag Link Mon Sep 1, 2008
You are working thru a Realtor correct? The listing agent should be the one selling this thru to the bank. Only 35% of all short sales ever go thru. A great resource for FAQs is the site below....good luck!
0 votes Thank Flag Link Mon Sep 1, 2008
Cindi Hagley, Real Estate Pro in Pleasanton, CA
MVP'08
Contact
Here Paul, I AM a Short Sale Expert, and if you want to run, I will give you some sneakers.
Now for Marys' question. I would agree with Jeff, they won't take a CD. If you Realtor is the listing agent, he should know how to get around this simple dilema, if he is not, then you really have a problem, as it is the listing agents job to straighten this out. The BPO has probably been completed and that is what they based their net off of. Problem with a BPO is that the people doing them, are hoping to get the listing if it isn't short sold, so they may "bump" the number a bit. If your agent is the listing agent, he CAN solve this.
0 votes Thank Flag Link Mon Sep 1, 2008
run as fast as you can and look for a ligitimate deal,stop wasting your time
0 votes Thank Flag Link Mon Sep 1, 2008
The easy eanswer is that it can not hurt. Lenders are typically already taking a loss. There may (or not) be several other offers that the bank is also considering.

There may be an all cash, as-is offer already submitted as well. When lenders are sellers or approving a short-sale, they really do not care much about the condition of the property- they just want to get it off thier books and move on.

IF, there are no other offers, your plan to show the needed repairs could work. By now, the lender mostlikely has a recent appraisal on hand and a BPO [Broker Price Opinion], they already know what the market will bear.
0 votes Thank Flag Link Sun Aug 31, 2008
Mary,

If you can come up with recently sold comps that support you position it would be most beneficial to present these as well

Be prepared to hear they have taken the overall condition of the home into consideration when determining their asking price.

Good luck,

The "Eckler Team"
0 votes Thank Flag Link Sat Aug 30, 2008
I agree with Jeff! I have done the very same thing and it has been beneficial in the negotiations. You should always support your position to the best of your ability.
0 votes Thank Flag Link Sat Aug 30, 2008
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