On short sales, the seller is the owner. The owner's lender is not a party to the sales contract however, the purchase of the property should have been written contingent on the short sale lender approving the deal and "agreeing to permit the proceeds from the sale of the property to pay the existing balances on loans secured by the Property, real property taxes, brokerage commissions, closing costs, and other monetary obligations the Agreement requires Seller to pay at Close of Escrow." Ask you agent if you have short sale lender WRITTEN approval of the contract. If your offer was written using the C.A.R. form SSA - Short Sale Addendum, then this document clearly states the terms as shown above in quotes in addition to setting the time frame for compliance with those terms as quoted below.:
"This Agreement is contingent upon Seller's receipt of written con sent from all existing secured lenders and lienholders ("Short Sale Lenders"), no later than 5:00 P.M. on ______________ (date)." and therefore without written approval from all Short Sale Lenders there is no contract.
Without knowing all the particulars of your deal, it is hard to tell you what your rights are at this time. I hope the above will help to open the conversation with your realtor about what is truly going on in your deal. If they cannot answer your questions, then you should ask to speak with their broker. Good luck in getting to the bottom of this and Dare to Dream.
Real Estate Consultant
RE/MAX Palos Verdes Realty
The best strategy as a short sale buyer is to make multiple offers. You should make MANY offers. I had one client that made 10 offers, and it still took months to get a yes on one single house.
Best of luck to you. Feel free to contact me if you have any more questions.
Broker / CEO
Vertical Horizon Real Estate
San Diego, CA 92101
Deposit was written to my realtor's office and cashed few days ago. Realtor forwarded (supposedly) it escrow.
Short sale addendum with Offer was signed by me on Dec 3, 2003. Item B.Time Periods, Section 1(ii) was checked: "shall begin the Day After Seller delivers to Buyer written notice of Short Sale Lender's consent.
Am I still entitled to the 10 day rule or am I stuck?
Unfortunately, this market has forced potential buyers like me to submit multiple offers. This was one of four offers submitted. Was outbidded by two, one was supposed to be vacant and "move in" ready but was occupied by 8 people who destroyed property.
I'm a first time pre approved buyer, not interest in fixers who looked for months in hope of moving into a house at the crack of New Year's dawn. Property of interest was one of many we looked at. It required major rehab. An investor bought it last month, fixing it up and want to sell it off the MLS. There aren't a lot of "move in" ready homes in my price range and the neighborhood I want that is not in "pending sale" status.
Thank you for the informative advice.
On the B section: (ii) is checked stating "shall begin the Day After Seller delivers to Buyer written notice of Short Sale Lender's consent.
So where does this lead me?
1. Did you sign any agreements or supplements provided by the bank, the seller, or the seller's realtor? If so, read them carefully to see if there is any wording that would alter the standard contingency period of 17 days.
2. You have the right to see the acceptance letter from the bank in order to verify that this short sale transaction was in fact approved. Escrow could have jumped the gun with issuing the escrow instructions prematurely. Acceptance by the seller is somewhat meaningless, since the bank has to approve the short sale before it can move forward.
3. Check the wording on your original purchase agreement (and any addendums or counter offers) to see if any of the standard terms of the contract have been modified (i.e. contingency periods, contingency removals, escrow cancellation). You should also have signed a Short Sale Addendum, which indicates additional contract terms in regards to short sale transactions.
4. Have you submitted your deposit to escrow?
If the bank has accepted your offer and your contingency period is still intact (even with a bank addendum, you should have at least 10 days), then you have the right to withdraw your offer during that contingency period. If you have not submitted your deposit to escrow and you are still within your contingency period, then there likely is no recourse since they have none of your funds, unless you've signed addendums or counter offers to the contrary. If you have submitted your deposit to escrow, then escrow has the right to retain a portion of your deposit to cover their expenses if you cancel escrow. Either way, as long as you have not gone past your contingency period, then you should be able to back out of this transaction with little to no financial impact.
That said, it is not a good idea to bounce around from property to property. If you're not sure that you want a property or not, then don't submit an offer until you've completed your investigations, including ruling out other properties in the area.
Without knowing what you have agreed to though, it is very difficult to advise you.
I wish you the best of luck with your situation.