I am sorry you are not able to get the best information possible while you are doing a short sale.
A short sale purchase is difficult and I have seen them go 6 month or more before the bank will
answer. And then it can go one of three ways, accept, reject or counter offer you. And with
the repairs that the home may need the bank may or may not be willing to make allowances
for this. That is why the short sale bank gets a BPO on the property, to get the market value of it
Which cannot always pick up a problem if the electrical is off, or it was not raining on that day
and the roof leaked later. There are just so many variables.
If you really like house stay with it but I would suggest if you are over the 6 month be looking at
You did not day if you know what bank is the short sale with but that will tell you a lot about how
long it will normally take.
I live in Lutz and work a lot with short sales both on the listing side and for buyers. Some work out
and some don't but you should always get answers to your questions.
If you have any other questions you can always give me a call or email me and I would be happy
to help you. Good Luck !
If it's already bargain priced considering the roof and a/c, they may simply let you cancel your contract and they'll offer up the house to another buyer.
Banks and Short Sellers will not do any repairs.
If the roof is in poor condition and you are getting a morrtgage you may not be able to buy it if you cannot get homeowners insurance.
There are Fixer upper mortgages but normally they cannot close quick enough for a short sale. Ask your lender for a HomeStyle Freddie Mac or an FHA 203K morrtgage and they will tell you it will be about 60 days to close--maybe 45.
If the house ends up foreclosing then what happens is if the lender will allow it to sell below the final judgement amount at the courthouse, CASH investors will bid on it at the courthouse. Once the investor buys it they may rent it out for a year for lower capital gains taxes or do a FLIP at the maximum sale price--no bargain to be had for you. Alternatively if the mortgage was insured by FHA/Fannie Mae etc then it will possibly go on the market as a HomePath.com or HomeSteps.com or HUDHomestore.com house and only be available to owner-occupant buyers for the first week or two. Also it may never come on the market and may get added to the pool of properties sold to investors via the http://www.FHFA.gov program where they will rent it out for the next 3 years.
Lastly the Seller may realize they may be better off with keeping the house and getting a Loan Modification or a Deed for Lease where they can stay in their home and rent back for 3 years.
So, bottom line is until/if you get an approval letter in your hands with terms that are acceptable to the Seller I would NOT spend any money on inspections, appraisals, etc. Hopefully you already have an approval and that is why you chose to pay for an inspection...
Good luck and keep looking if you feel you are overpaying for this property. Remember, though, there isn't much inventory out there so go take a look before you decide to cancel.
All the best,
Alma Rose Kee, PA
Future Home Realty
If you really like the house and have the money to do it, you could wait until it goes to foreclosure auction and try to buy it there. I donâ€™t know what state you are in, so you would need to find out how it works where you are. Here you have to have $5,000 to bid, and have 24 hours to come up with the rest.
If that isnâ€™t an option you can hope the bank buys it back at the auction, which happens a lot. And then try to buy it from the bank. It would be sold â€œas isâ€, so you would still have to do the roof repair and a/c, but you should be able to get a good enough deal to make it worth it.
Good Luck, Just remember it is a short sale and they are a major pain in the â€¦â€¦
You are in a real spot that is difficult to navigate. However, good guidance has been provided. Jonnie Rosser gave incredibly concise direction...LOOK FOR ANOTHER HOUSE!
Why? you might ask. "I love this house and don't want to lose it!"
Chances are you are financing your purchase. The lender will REQUIRE a watertight roof with fives years of serviceable life to grant the mortgage. They will want a functioning HVAC also. Then the lenders rigged appraisal must be circumvented. Only the latter can be resolved by you. The owner, if facing foreclosure will not spend another dime. The bank will not do anything until they foreclose and own the house. Unless you are willing (and legally allowed) to put a new roof and HVAC on a house you do not own, you have reached an impasse.
Oh, you are paying cash!
You will need to adjust your offer to reflect the known condition. Make a 'skin in the game' commitment to the process and communicate to the 'negotiation team' (they are your friend in the process) the need to halt the foreclosure process. Even the best efforts often fail when trying to direct a 'too bit to fail, too big to govern organization."
This is the reality of the "Wild, Wild, West of Real Estate - Short Sales" where there is an illusion of rules but anything can and does happen. The only path to a predictable outcome is finding the other home that is out there waiting for you. This one is not meant to be.
Best of success to you,
Annette Lawrence, Broker/Associate
Remax Realtec Group
Palm Harbor, FL