YES you do have rights regarding short sales.
You have the right to stay away from short sales. Most short sale properties are not handled/managed properly, which allows for situations like yours.
Also, you were the one that gave the seller's the expiration date. If the seller's don't respond in time, then you have your answer and you can either move on to another property or have patience and try to work with the sellers. Short sales require an extended amount of time, and unlimited amount of patience and understanding -- it's not your normal real estate purchase. So, stop trying to treat it as such.
And, once again, YES you do have rights regarding short sales. You have the right to stay away from short sales. Most short sale properties are not handled/managed properly, which allows for situations like yours.
PAUL WELDEN, PLLC
Exclusive Buyer's Agent RealtorÂ®
You made and offer to the seller but the contract should be approved by the lender. You don't have any advantage as a one that made the first offer, the bank will pick the best one. Nothing depends on the seller's agent, he is waiting for the lenderâ€™s respond too. Sometimes seller's agent calls 10 times per day to the lender and there is not response. Your agent should have told you that some times could take a year to close a short sale or sometimes it does not close at all. The bureaucrat in the bank does not care that you are responsible buyer, sometimes they have like 100 short sales on their desk, so be patient and don't blame the seller's agent, 95% of the time it is not theirs fault.
Coldwell Banker Residantial Brokerage
972-758-2045 Direct Line
MAking offers on Short sales are very frustrating! As an agent we do our best to communicate to buyers that it can be months before the bank gives an answer on an offer. Hopefully the agent will submit the strongest offer to the bank not necessaryily the highest.
The bank gives us nothing in writing in most cases and lets us know if they will accept an offer or if we need to increase the offer several weeks down the road.
The good thing is you will probably get a great deal if you can wait several days or months! Many buyers drop off and look for other homes. I would say keep looking and make other offers on homes you like and cancel the other offers once one is accepted.
Difficult I understand but true! Feel free to contact me if you have any questions!
The only rights you have when submitting an offer is to either withdraw the offer or to extend your offer's expiration date. Other than that, you have no rights until an offer has been accepted. If your offer was not accepted, then you have the right to move on to another property. Usually there are multiple offers on short sales, because they are priced so cheaply ... so cheaply in fact that most lenders won't approve offers at or below the list price, or the price get's bid up b/c of multiple offers.
Short sales are very difficult. In fact about 90% of short sales never end up with a closed transaction. Even if your offer gets accepted by the sellers on a short sale, it's still contingent upon the sellers lenders to accept it. Most short sales that do end up closing, they usually have a final sales price of 90%-100% of the market value. So, don't expect to get a "steal of a deal" on most short sales.
Unless you have found your perfect home and it's a short sale, you are better off buying directly from a bank or from a private seller who is not in foreclosure. I welcome you to visit my site for more information on short sales & how to find the foreclosures that are actually for sale.
Buyer's Agent REALTOR
HomeSmart Real Estate
We are sorry about this most difficult experience.
First, regarding your rights as a buyer until you have an accepted offer there aren't many BUT when you assign a deadline to you written offer(3 days to respond),........this is a right. If they do not respond, your right is to move on, with no consequences and explore other opportunities. At this point your deal is DONE.
Let's look at this complete sinerio, the seller is caught between someone they want to sell their property to and the bank that holds the loan. Keep in mind that for a "short sale" the seller is requesting the bank to accept less money than it is owed for the property...the bank will probably lose thousands if they agree. They may take weeks to get back to the seller about the status of your request....banks don't care about any deadlind except their own.
Knowing that only 10% of short sale offers are accepted is pretty discouraging and coupled with the kind of experience you are having is the reason why many agents are electing not to work with short sales and why some buyers are electing to pursue "foreclosures" instead, where most of the problems have been worked out and the property ownership is in the hands of the bank.
Short sales are a tough roar but you do have options.
The "Eckler Team"
Your only protected right is the right to walk away from the offer and find another home. If you give a three-day response period, the seller can take that full amount ... or longer, if they believe you will not walk away from your offer after that timeframe has expired. (Going past the response period makes the offer voidable but not necessarily void, as your agent should have explained.)
Also keep in mind, with a short sale, the bank easily can come back and ask for a higher sales price. The list price on a short sale means nothing - something else of which your agent ought to have advised you.
Here is one example (all short sales are different).
A seller list their home for market value or below market value.
The listing agent markets that home to get the highest and best offer. Often they may want to wait 7-10 days to prove to the seller's lender that they marketed the house fully.
Buyer(s) submit offers to the seller and the seller accepts an offer contingent upon the banks approval (if you use short sale addendum you may have a better understanding of the details).
Then the listing agent submits the offer along with all the other documentation the seller. This includes the seller proving hardship, bank statements, check stubs, assets and liabilities, from the seller ..etc.
Then the seller's lender order's a BPO (broker price opinion) This independent third party broker will give their opinion of the value of the house.
The seller's lender now reviews the entire package and makes a request of their investors to determine if it makes financial sense to the lender to short sale or to foreclose.
Now if there is a second, third or other liens, they too have to decide how much they want to forgive of the debt and the first decides if they will give them anything.
If the seller's lender determines the offer is too low for the market or the numbers the seller's lender wants they will verbally tell the negotiator we want X$. You will either have the choice to meet that, counter it or walk.
In the meantime if a better offer comes in, or the bank decides to foreclose you're out.
If they do accept your offer they will ask you to close in 30 days or less. If your appraisal comes in lower then there will be a problem with the bank. If you discover repairs, more problems with the bank.
This can take months.
The communication throughout this is very limited, a good listing agent will give a weekly update, usually something like, we haven't heard anything. But most don't. If they don't communicate they don't have any word, they have a huge inventory or perhaps your agent is bugging them and they're ticked off.
So, are you ready to stay in the game? If not, bow out and let another buyer deal with it. Otherwise, be prepared to wait, and wait. And don't get attached to the outcome, no one knows what the seller's bank will do.
Good luck in getting your home.
Unfortunately your only real right is to specify a deadline for a response. If the don't response by then the contract can be canceled. Although I agree with you in the fact that the communication with the seller's Realtor should have been better.
Discuss the timelines with your agent. On a short sale you will have to wait up to 2 or 3 months to get a response from the bank - which is very common for them to counter-offer with a higher price, even if your offer was full price (or over full price).
In most cases dealing with short sales is not worth it, most people are better off dealing with foreclosures or independent sellers.
It sounds to me as though you might have an agent that has not had a lot of experience in short sales.
At least in my area, you need to give them 30 days, not three, to respond. Lenders are overwhelmed with work and they simply cannot respond in three days to anything.
If you want this house then your goal is to :
find out from the listing agent how much experience they have had with short sales
find out what the expected timelines are
find out what the lender would like, and anticipate their needs
When you submit an offer it should be complete, get the lender addendum, proof of your deposit funds for down payment, making it clear that you are serious.
Can you close in thirty days?
Did you already inspect the property? They may say "as is" but YOU don't want to buy without knowing what it needs.