Home Buying in Portland>Question Details

Jenerra, Home Buyer in Portland, OR

Is it true that in a short sale a bank/seller is less likely to accept an offer that asks for a portion of?

Asked by Jenerra, Portland, OR Thu Feb 5, 2009

the buyers closing costs to be covered?

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Answers

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In looking over the answers so far I think your question was answered, but I would like to let you know a couple other things about short sales that you may not be aware of. An offer you put in will in most cases be only one of several that have been agreed to by the home owner because the bank (the 3rd party) wants to see all offers and will choose the best offer. So in getting your offer back as accepted by the homeowner, it does not mean you have a deal to purchase the house. You still await the 3rd party's approval.

Secondly, it's best to make your highest and best right off the bat because once the bank gets the offers and reviews them they will then try to do verbal negotiations with every party saying they want highest and best offers. There will be no traditional haggling back and forth with counter-offers. So if you really like a property indicate the offer is your highest and best (and leave no room for regrets) GIve it your best and be willing to wait weeks (in many cases) to find out the banks response. If you are not a patient person a short sale is not the way to go.

Thirdly, there is a chance the offer will sit with a bank for quite a while, then the date of auction approaches and the bank hasn't decided anything. The home goes to auction, if noone bids higher than the bank (who will bid so as not to risk too much in losses), the bank gets the property back it will be relisted as a REO. Then you get to start all over again. This happened to one of the short sales a client of my waited on. When listed as a REO (real estate owed) it is handled more like a traditional transaction.

So in conclusion, know that not all banks work the same way when it comes to their properties that are in default; is important that you determine just how long you're willing to wait once you put your offer in.

Most of my clients who are doing short sales (attempting to) continue to receive my automated searches matching their criteria (you can too)- just in case something better comes along.

Let me know if there is any way I can assist you. If you want to search properties, save your searches and favorites on my web site where you'll log in under your own secure login. I welcome you!!

Thank you for your great question!

June Lizotte, Realtor
Providing REAL Service
Prudential NW Properties
6400 SE Lake Rd., Suite 200
Portland, OR 97222
jlizotte@prunw.com
503-310-8032 (mobile)
503-212-2727 (office)
Web Reference: http://www.junelizotte.com
1 vote Thank Flag Link Fri Feb 6, 2009
J: the banks are definitely negotiating on a "case-by-case" basis! It also matters if there are other liens (i.e: lenders on the property) such as 2nd mortgages, lines of credit, etc. It does become more complicated if there is more than one lien holder. I think some of the lending institutions are playing "catch-up" getting systems in place and properly training personnel to handle the deluge in requests for short-sale consideration....jj
Janeese Jackson, Principal Broker
Real Estate Resource
503-709-0802
0 votes Thank Flag Link Thu Feb 5, 2009
Hi - I've sold a number of short sales over the years...both from the buyers side & sellers side, and I've not had any trouble with getting banks to agree to contribute to buyer's closing costs. Most will know what their bottom net figure is and they don't much care how the offer is structured as long as they get their net. The most recent one I sold, I was working with the buyer - the seller owed almost $220,000 on his loan and the bank took our offer of about $165,000 and agreed to pay $10,000 on buyer's fees. By the time the commissions and fees to sell came out - the bank agreed to around $70,000 less than the seller owed. It turned out well for both the buyer and seller!

Kelly Gebler
Real Estate Broker & Residential/Commercial Loan Officer
Commonwealth Real Estate Co., & Sunset Mortgage Co.
Ph: 503-516-1637
Email: LetUsGuideYouHome@comcast.net
0 votes Thank Flag Link Thu Feb 5, 2009
In a short sale the seller is the owner of the home, the bank is the third party approval. There are many factors that the bank will look at in determining what they are willing to agree to. If the price you're offering is an acceptable one , then the bank may agree to the closing costs you are asking for. There is no hard and fast rule.
0 votes Thank Flag Link Thu Feb 5, 2009
I have not found this to be true. It almost always depends on the bottom line to the bank and what they are willing to lose financially. Generally speaking, the total of the closing costs you want them to pay, the brokerage fee and other miscellaneous charges should not exceed 10% of the sales price of the home. If it does, it may fall outside of the guidelines set forth by FNMA and may make it a mortgage that cannot be purchased on the secondary market.

I hope this helps :)

Garett Chadney
RE/MAX Equity Group
(503) 495-3123 direct
http://www.GarettChadney.com
0 votes Thank Flag Link Thu Feb 5, 2009
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