Foreclosure in Los Angeles>Question Details

Ann Guyer, Home Buyer in Los Angeles, CA

Can anyone help me wtih the steps of a short sale. Once I put in an offer, what do I have to do next? Does?

Asked by Ann Guyer, Los Angeles, CA Fri Feb 13, 2009

the owner ever pay any closing costs in short sales? Is there any room for negotiating things that turn up on an inspection report?

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THERE IS NOT A LOSS MIT DEPT THAT WILL GIVE YOU A STRAIGHT ANSWER WITH OUT AN ATTORNEY INVOLVED. W-A-S-T-E OF TIME!

SOME OF THE HOMES HAVE HUGE INSURANCE PAYDOWNS PENDING THAT WONT HAPPEN FOR MONTHS. THEY TAKE IT DOWN THROUGH A DUMMY CORP OR TRUST LIKE THE KINDS I FACE IN COURT REGULARLY. TAKE DUESTCHE BANK IN SANTA MONIC COURT LAST WEEK - WHOPPS!

THATS ANOTHER CASE WE LOST TOO AGAIN - BUT WE CAME BACK WITH AN INJUNCTION AND SO ON.... BUT WE LOST TO A REALTOR IN A FORECLSURE SHORT SALE PRECEEDING. TO A REALTOR.

WHY WAS A REALTOR REPRESENTING THE BIGGEST BANK IN THE WORLD - UMMMM - OKAY. THATS ENOUGH SAID FOR NOW!
0 votes Thank Flag Link Sat Feb 14, 2009
To your first question...Wait! to hear from the lender. This can be trying at best (we do a lot of foreclosures and short sales and I still don't understand why it takes so long). YOU CAN negotiate costs or repairs although most banks would rather sell the property "as is". It just depends on whether there are other offers. The majority of short sales that we represent have multiple offers so you want to submit as strong of an offer as possible. Most short sale listing agents will tell you whether there are other offers. If you are not being represented the biggest downfall I can see is communication between you and the lender. We would be happy to explain more of the process if you would like to call us. Good luck on your house hunting...

Jeff and Cheryl Fox

Properties Plus
818-995-9108 Office
800-917-8080 Toll Free
818-207-2013 Cell
Email: mail@jeffandcherylfox.com
Webstie: http://www.jeffandcherylfox.com

16133 Ventura Blvd. 7th Floor
Encino, CA 91436
0 votes Thank Flag Link Fri Feb 13, 2009
Ann,

I forgot to also answer your question about the owner ever paying any closing costs in short sales. What happens is in the offer, if you requested it and the seller signed etc, the bank will approve whether or not closing costs can be paid. I just had one yesterday and the bank is paying up to 3% of the buyer's closing costs. It all depends on your offer and also the bank, but typically yes if it was in the offer!

Kind regards,

Joan Patterson, B.A., A.S.P., G.R.I., Realtor
Keller Williams Realty
951-204-1864
http://www.calljoan4homes.com
0 votes Thank Flag Link Fri Feb 13, 2009
Hi Ann,

First of all, the seller needs to sign the offer/counter etc. This all then gets submitted to the bank. Just because the seller accepted your offer does not mean that the bank will. This is very important to have in mind. Also, is there a first and a second loan on the property? If there is only a first and the house is priced right and the sellers are behind in their payments, you stand a better chance of having your short sale approved. It is important that your agent keep in touch with the listing agent to get updates at least every few weeks.
Working with the banks can be challenging for sure. I just got a short sale approved that only took 30 days, but I have worked with others that took 6 months, and others whereas the banks still have not gotten back to us and it is going on 9 months. My buyer on that last one finally said he wanted to look at REO homes. I certainly don't blame him.
On a short sale, you asked if there was any room to negotiate things that turn up in an inspection report. The answer clearly would be no. The people need to sell...that is why they are doing a short sale. None of the proceeds will ever be given back to the seller, they have nothing coming to them from the sale. They are in a financial bind, therefore, they do not have any money to fix anything. The bank won't pay for anything either. So, just know that going into it. They are one step away from foreclosure when they are doing a short sale, so they have no money. If they did, I am sure they would rather be staying in their home instead of having to sell it short of what is owned and have their credit score hit from 80-100 points. They won't be able to buy a home a long time until their credit is repaired.

I hope this answers your questions.

Good luck!

Joan Patterson, B.A., A.S.P., G.R.I., Realtor
Keller Williams Realty
8250 White Oak Avenue, Ste 102
Rancho Cucamonga, CA 91730
951-204-1864
http://www.calljoan4homes.com
0 votes Thank Flag Link Fri Feb 13, 2009
Once you put an offer on a short sale, the bank has to approve the price and the conditions. Usually a short sale is a like a Bank Reo property in that the property is being sold in as-is condition. When the sale is approved by the bank the agent receives an approval that states what the bank needs to net in order for the sale to go through. You can always as for the repairs, but they are it is highly unlikely that you will receive them.
0 votes Thank Flag Link Fri Feb 13, 2009
Speak with buyers agent who is managing the sales offer contract on your behalf.

We state to our clients if foreclosure, short sale, never count on fact contract may be accepted by bank once offer is submitted . Our clients have back up properties if we dont have a response within 7 days best continue on with other locations.

Sales offer contract governs what % if seller agreed to pay on your behalf which is your lender approval. Regards to inspection report many of these properties are sold as is , seller in short sale most likely does not have money for repairs. Work with buyers agent on these concerns
Web Reference: http://www.lynn911.com
0 votes Thank Flag Link Fri Feb 13, 2009
Go to an Edgar Web Site or other SEC filing information web page. Look up the asset and security. Get the Trustee and master Servicer information. Use it with an attorney to compell the Depositor in the asset backed transaction to honor the sub servicer understanding to sell the asset short.

Otherwise - its play games trime
0 votes Thank Flag Link Fri Feb 13, 2009
Hi Ann,

First, I would highly advise you to work with a buyer's agent who is experienced in short sales. They will be able to answer these questions and help the process along smoothly. Oh, and working with a buyer's agent doesn't cost you a dime!

You can always negotiate with the seller on a short sale, but that doesn't mean the bank will accept the price that you and the seller have agreed on. Short sales can be a lengthy process and there is a lot of waiting, waiting, waiting and then hurry hurry to close.

Please call or email me with any questions and I'm happy to assist.

Thanks,


Grant Linscott
Keller Williams Realty
323.333.6222 Cell
grantlinscottproperty@gmail.com
0 votes Thank Flag Link Fri Feb 13, 2009
Hi Ann,
Your agent should be able to explain every step to you. Once you present the offer, the lender has to approve it. The owner does not pay for closing costs or repairs, since they are selling short. The lender will not pay for repairs as well. A short sale is sold "as is". You do have the right to inspect the property for anything you like as long you put an inspection contingency period into the offer.

Best,

Tova Sarir
Keller Williams Realty Beverly Hills
homes@tovasarir.com
310-497-1930
Web Reference: http://www.tovasarir.com
0 votes Thank Flag Link Fri Feb 13, 2009
Hello Ann,

I believe I missed part of your question. Once you put in an offer you wait until the bank accepts it which can take 1-5 months or not at all. It's important to be patient. The bank may not accept your offer. It's also good to keep you eyes open for another home if that one drags out to long. You will be paid of with patience in a short sale as there are great deals to be found.

Good luck!

Best,

Monique Carrabba
The Carrabba Group
Keller Williams Hollywood Hills
mcarrabba@kw.com
0 votes Thank Flag Link Fri Feb 13, 2009
Hi Ann,
THe first step is for the seller to accept your offer. Next, the offer is sent to the bank for their approval. This can be a lengthy process that can sometimes take months. If there is only a first on the home, you might here back fairly quickly. If there is a second, third, etc, it may take a very long time. The first usually will only give a pittance to the holder of the second, sometimes only a thousand dollars or so, and the second can torpedo the deal.

Once you get acceptance, you can ask for money for repairs from the bank. Since the seller is in distress, they most likely will not pony up any cash to get the deal done. The bank would have to agree to take money out of their bottom line to get the deal done. They most likely will not do this, but it doesn't hurt to ask if your requests are reasonible. I would recommend you only ask for items that are related to safety and functionality. Nothing cosmetic.

If you want the seller to pay and closing costs, write it into the offer. Since the bank is going to be paying the closing costs, they will have final say in the matter. I have seen most banks say absolutely not, but it is possible.

http://www.bigbearilluminated.com
0 votes Thank Flag Link Fri Feb 13, 2009
Hello Anne,

Sometimes you can negotiate with issues that come up on the inspection report. Usually in the acceptance from the bank that the property is as is and it is the buyer, seller or agents responsibility to remedy any issues. If you find problems on the inspection report on a short sale as long as you are still in your contingency period and you don't think the price you got for the property is low enough considering the amount of work, then back out if you can. You can always try to get money but chances are you won't get it unless someone kicks in. The owner does not pay closing costs with a short sale usually. I have an expediter I work with. If you haven't already put in an offer, I recommend using an agent that is experienced with short sales and has the connections to get them approve quicker as they can go on for months with the banks being so backlogged.

Good luck!

Best,

Monique Carrabba
Keller Williams Hollywood Hills
The Carrabba Group
mcarrabba@kw.com
323.899.2900
0 votes Thank Flag Link Fri Feb 13, 2009
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