The banks will usually accept lower than asking as long as it is within 1% - 3% of asking price. Some short sales the bank will have already determined a pre-approved price based on appraisals and/or broker price opinions. In this case, the bank will not sell for less than this price unless the home remains on the market for a long period of time. Before your offer gets to the bank, in most cases the offer is going to need the blessing of the listing Realtor because some short sales are in pre-foreclosure and time may be short and precious time may be wasted if an offer goes to the bank that has a slim chance of success. The bank will only work one short sale offer at a time, so it is in the best interest of all parties that the offer that has the most chance of success end up being the offer that is forwarded on to the bank for approval.
Keep in mind the following when purchasing a short sale:
Make sure that you find out if the currently homeowner has paid the HOA dues current! The banks generally will not pay more than the equivalent of 12 months dues. Once the dues become delinquent, the association will usually seek the help of the attorney and a $325 past due balance can quickly grown to over $5,000 or more and the bank won't likely pay it, and the homeowner usually can't because they have a financial hardship. Always ask the question if the association dues are paid current.
Three other items to be aware of, at least in the area I sell homes, the buyers are being required to turn the utilities on for inspections. This should be disclosed to you, but I have found that many times the listing Realtor is not disclosing this. This will require YOU to put up the deposits and pay the expense of turning the utilities on. Once last item, make sure you ask if there are any outstanding assessments that have not been paid that the seller may be unable to pay, like a road pavement assessment or special assessment. Find out if there is a negotiator fee. It is not uncommon for there to be a negotiator fee, however, you should know what that up front. Everything related to the transaction should be listed on your HUD settlement statement - no outside deals.
Fred Strickroot, RealtorÂ®, MBA, CDPE
Florida Lic. Real Estate Brokerage
2154 Seven Springs Blvd, Suite 103
Trinity, FL 34655