Foreclosure in New York>Question Details

Suze1220, Both Buyer and Seller in 10706

I just made an offer on a house that is in short sale. My agent tells me that there are 3 offers on the

Asked by Suze1220, 10706 Wed Aug 20, 2008

house and that I can reconsider offering more. Is there any way to find out if this is true? Also, can I verify that the bank really wants an appraisal to set the price that they want to accept? I understand from my broker that even if I raise my offer, the bank may decide that they won't accept it and request more.

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There is no way that I am aware of to verify the listing agent actually has 3 offers...actually short sales and REO's are very popular right now and it is probably safe to assume there are multiple offers.

I do BPOs (broker price opinions) constantly. And yes, the bank absolutely asks for BPO's on short sales to verify current market values in a rapidly changing market. All banks are looking for current market value and yes, they may counter-offer any offers they get. I know this from personal experience.
Web Reference: http://GailGladstone.com
1 vote Thank Flag Link Wed Aug 20, 2008
This scenario just rubs me the wrong way.

Attorneys and realtors who treat the short sale situation the same way as a regular purchase need CLE or CE classes.

A short sale is not a deal until the lender says it's a deal.

So if someone has you sign a "contract" prior to lender approval the contract is absolutely useless until such time as the lender see fit. And they can always kill the deal up until and EVEN AFTER closing. That's right the lender can REJECT the payoff and leave their mortgage / lien on the property AFTER closing.

So my advice is:
Only negotiate a short sale through parties who have experience doing it.
Never give a deposit until the lender has accpeted your offer.
Only enter into a contract after the lender has accepted your offer.
Be ready to wait months until the offer is finally accepted
Make absolutely certain that the closing agent, title company, and attorneys know what they are doing so that you do not have any post closing issues.

As for the old "other offers" sales tactic - move on - their are PLENTY of these out there. No need to haggle over a deal that isn't even real yet!

IMHO
0 votes Thank Flag Link Tue Dec 23, 2008
So you want to buy a short sale huh - click the web reference link below - cheap and packed with information.

You can also go to http://www.tomsresource.com/short-sales/

Good luck!
0 votes Thank Flag Link Sat Sep 13, 2008
You have posted this question numerous times and received many answers. If you have not yet received the answer you had hoped for, it is because what you are looking for is not the answer.

Reread all of the comments these real estate pros have taken the time to offer you and follow them.
Web Reference: http://GailGladstone.com
0 votes Thank Flag Link Sat Sep 13, 2008
Short sales are not totally decided by banks, the acceptance of a short sale offer needs to be approved by the investors who own the note on that home. As you may be aware, mortgage instruments are sold on the open market to investors, and they are the ones who can make a decision on a short sale. Of course, the bank servicing the loan needs to communicate the intention on a new purchase, together with the Pre-approval letter, the proposed HUD, and the Commitment letter then, wait for the investors decision. If the loan officer involved in the new purchase can communicate with the bank on the subject property, he or she can assist expedite the documentation needed. It should not take more than 45 days to complete the transaction. It is true that most lenders on the subject of short sales are becoming more strict on the pre-approvals, and prefer to seriously consider pre-approvals coming from reputable mortgage companies that assess the entire credit worthiness of the applicant. GET A FAST MORTGAGE PRE-APPROVAL TODAY: 914-285-1452 --Wells Fargo Home Mortgage is a division of Wells Fargo Bank, N.A. © 2005 Wells Fargo Bank. All rights reserved. Equal Housing Lender.
0 votes Thank Flag Link Sat Sep 13, 2008
Yes, the bank may request more, but we don't think there is any way you can verify if there are 3 offers on the house. We are working with a few buyers who had offers on short sales and are now looking for other homes as the offers they made on the short sales with other agents is taking too long and they need to move and can't wait any longer to hear from the banks. Banks do ask to verify current market conditions with BPO's (broker price opinions) and the process can take many , many months.
0 votes Thank Flag Link Sat Sep 13, 2008
In today's market with increasing credit risks, arm yourself with a well known bank on a pre-approval letter or even better yet, get a full approval for a mortgage from a reputable lender such as Wells Fargo Home Mortgage and I can assure your will obtain the expected results.
For additional details and further questions, please visit us
at http://www.sonniacarbone.com Tel. 914-285-1452 or Cell 914-318-0228
0 votes Thank Flag Link Fri Sep 12, 2008
Suze,

Welcome to the world of "short sales."

If this is THE one, and you REALLY, REALLY have to this home, play the game and give it your best offer. On the other hand, if you have doubt.....doubt about integrity, if the home is worth the effort or money, about the bank etc. etc. walk away and test the water elsewhere.

There are many other opportunities out there and quite possibly one that will surpass this one.

Good luck,
0 votes Thank Flag Link Sun Sep 7, 2008
Let me explain how it works in real life. Supposing, the value of the property is $500K. There are three offers: $350K, $360K and $370K. Listing agent will ask the $370K bidder to sign a contract of sale. This contract will be send to the bank for their approval. Then bank will send appraiser or broker to the house and based on their opinion the bank will make a counteroffer. Counteroffer is always higher than the amount in the signed contract. Supposing, it is $430K. Then listing agent (an experienced one, at least) will communicate this counteroffer to all three bidders. Supposing, the $370K bidder says that he will not go higher than this. $350K bidder says he will only go $400K. The $360K raises his offer to $410K and bank accepts it. The old $370K conract goes to trash.

You see what I'm getting at? It's not important which bidder got initial contract. What's important is that all three bidders stay in touch with the listing agent and act promptly when counteroffer is received from the bank. THERE IS NO NEED TO INCREASE YOUR OFFER until you hear a counteroffer from the bank. Tell the listing agent that you may increase your offer ONLY AFTER you hear the counteroffer from the bank.
Web Reference: http://housebrooklyn.com
0 votes Thank Flag Link Sun Sep 7, 2008
Dealing with short sales can truly be draining. Be mentaly prepared. Please let me know if this home needs repairs. We do renovation loans up to 97% financing. sunny_hong@countrywide.com
0 votes Thank Flag Link Fri Aug 22, 2008
your broker most likely correct. do a half mile search radius, the banks typically will value the home in the lower end of those. When there is 3 offers the highest is typically a market price offer.
0 votes Thank Flag Link Wed Aug 20, 2008
When a short sale is given to the bank there is a process that they follow.
They look at the package to see what the net is to the bank. If it falls within the guidelines of what the banks investors allow, they will proceed with an appraisal or minimally a broker price opinion.

Most banks require that a person go to contract in order to get an answer. When you state that there are 3 offers, did they go to contract? Short sales can be worth the time and effort, if you have it!
Web Reference: http://www.cyndimckenna.com
0 votes Thank Flag Link Wed Aug 20, 2008
yes this is all accurate. Ask the agent to access the latest "BPO" (Broker Price Opinion).

Ask him/her to provide you with a comparative market analysis on the property - a good one, that may suggest (as close as possible) to the appraised value of the property (very important).
0 votes Thank Flag Link Wed Aug 20, 2008
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