Short Sale

[DisneyMomOK]

:::.

 

[TiggerStac]

If it's the same as what my ex sister in law is going thru...she's trying to sell her house because she can't afford mortage anymore.

She has it listed for 105K less than what they owe.

They are trying to do a "short sale" so they are trying to sell the house for less than what they owe and have the bank "forgive" the balance.

I have a friend from college that was on the buyers end of one of these and she waited 6 months for bank to make decision and finally said forget it. Ex sis in law has been waiting 2 1/2 months since offer was made (and she accepted) and doesn't have a response from bank.

Again..not sure if this is same situation, but sounds like you are on the buyers end of a short sale like these.

If it goes thru, it would keep the bank from forclosing on the house, I believe she is set to move in August either way.

 

[katied]

These take a very long time, generally, and there is no guarantee. They are more likely to go through when the house is already in foreclosure, and the short sale is occuring during the redemption period (i.e., the bank has foreclosed on the property, the house went to the sheriff's auction, the bank repuchased at the sheriff's auction, and the homeowners are living in the house during a set redemption period (which varies based on state law). Even so, you never know what is going to happy and how long it may take. We have tried to buy several houses under a short sale, and so far, no success. One dragged out for more than 6 mo, another were now looking at over 4 mo. If the seller's agent is a short sale specialist (and yours is a well) you have better hope. The seller's agent should be pulling comps, etc., and a report on the condition of the house to help support current value. If this is not happening, and the seller's agent is not assisting in the bank negotations, good luck!

 

[AllesonWonderland]

My folks put an offer in on a house in this situation. The seller accepted it, they waited and waited to hear from the bank and when the bank finally got back to them they said they wanted $x for the house. (Which was way more than the seller even had it listed for.) So, a complete waste of time for them. I hope your situation works out better...but my advice would be not to get your hopes up.

 

[DisneyMomOK]

:::

 

[poohs4me]

We have been going through the short sale process as a buyer now for over a year. Our first experience the decision took over 6 monthes. The most recent experience is working on 4 monthes. If you know who the banks are that own the seller's loan you can google their name and short sale and some realtors have posted a variety of time line information. Its not a guarantee on the time line but it does give you an idea of what to expect from the bank. Our favorite line is "you should hear something next week". We were told that every week for about 2 monthes.

 

[Shelley Chiarats]

We're going thru the short sale process from the seller's side of things and its not any easier here. We bought a home for $64k in Oct 07 in Upstate NY. Shortly after that we found out my husband was being let go and he found a new job in Western KY. We put the house on the market in May 08 and moved in Aug 08.

We'd been saving for vacation and were prepared to use that for closing costs. But we only got one offer that had to back out the next day when the buyer broke her hip at work the night she made the offer. Many months later, we finally got another offer. Having spent most of the savings on living and gas since we're currently staying 100miles from where my husband works. We had scraped together and arranged for closing on this offer when the appraisal came in at $52k and the deal fell thru because the buyer couldn't get a loan for the offer.

Now almost a year later, we had four offers in the same weekend. We accepted the highest one letting them know it's going to be in the banks hands as we can't scrape together enough cash anymore to pay the difference between what we owe and the offer and closing costs.

We've had to jump thru many hoops for the bank. And like the buyer, we keep getting told we should know something soon over and over again.

Good luck to all of you,
Shelley

 

[DisneyMomOK]

:::

 

[DisneyMomOK]

:::

 

[DisneyMomOK]

:::

 

[uva185]

Anyone know anything about this process (the negotiation)? We made an offer that seller accepted and now it is with the bank's "negotiator". Our agent is a really nice guy, but completely unhelpful in explaining this step. I Googled and, then, purchased a book on SS/Foreclosures and am still a little confused. I *think* this person goes to the junior lien holder(s) and talks them down to much smaller number than their loan and, possibly, re-negotiates the real estate fee, too. It has been a couple of weeks since we made the offer, so we would really like to know if it is going to work out or not.

TIA!

It really depends on a variety of factors...

-How many offers have been accepted. Often times the bank will continue to accept offers until a decent offer is made.

-Has a BPO been conducted on the property yet?

-What is the assessed tax value on the property? How close is your offer to the assessed tax value?

If your offer is with 80-90% of assessed tax value I think you will have a great shot at getting the house. Anything less and the bank wait hold off to see if any additional (higher) offers come in.

 

[cats mom]

I'll be thinking positive thoughts for you.

Until very recently I'd say short sales were just price fishing expeditions, at least around here. They were about collecting bids and assessing interest. Even qualified offers very near market value were ignored since no one would make decisions about accepting writedowns on any deficiency.

Just speculation on my part, but I doubt BPO's were even thought about until the property was offiically on the banks' books.

I think that's finally starting to change a bit though as I've actually seen a few short sales close before going REO (bank owned)

I hope the house you want is one of them OP!

Be patient, think positive thoughts, but don't get too emotionally invested while you wait.

 

[poohs4me]

No problem. None of the short sales we have submitted an offer on have been with citi, so I do not have personal experience on that. However, the very first short sale house we put an offer on, someone "accidently" provided the BPO number to one of the realtors involved. We were over it and thought it was a done deal. The bank ended up going with a lower offer, but they were all cash we were not. So as previously stated there are all sorts of factors that weigh in on it.

The worst thing for us has been when the seller's realtor pushes to move the foreclosure date. The bank just seems to move the house back to the bottom of his list. Frustrating. I know I have read on a variety of pages that some short sales go pretty quickly, but if there is a first and second it lowers the chances. Just be patient if you really want the house and plan on three months - just in case.

 

[Kriii]

We are (knock on wood) closing on a short sale house we are buying next week. It has taken approx 16 weeks to get to this point and it hasn't been an easy process. We found out the hard way that even if the lender has verbally ok'd the sale price and short sale, once there is an actual offer in they still need to review the seller's information to determine if there is no way to avoid forclosure without a short sale, review the offer, and appraise the property to make sure the offer is consistent with the property actual value. If their is a second mortgage, that lender needs to agree to the lesser amount also. In our case, the loan originator (Countrywide) needed to also ask the investor who they had sold the mortgage to for approval of the price. There may be a counter offer if your offer is deemed too low or the offer may be rejected outright if the lender thinks they will do better recovering money in forclosure. I THINK the negotiator is the person who deals with the price of the property. I hope to goodness that you aren't dealing with Countrywide/BOA as they are really a mess! In retrospect, I would never attempt a short sale unless you are prepared to wait a long time and possibly be rejected. If you do have time on your hands, it may well be worth a shot!

 

[DisneyMomOK]

:::

 

[StitchyPoo81]

OMG I hate short sales. We put an offer on a house back in March. The asking price was $149,999. We wanted to do a FHA Loan. They came out to appraise the home for $165,000. Well finally around May 16th the Bank counter offered and wanted $179,999 and we kept saying well FHA said it was only worth $165,000. The bank didnt care and was not accepting anything. Well that ticked us off. But its ok we found a better house and settle on June 5th
So the Realtor put the house back up for sale and the asking price again was for $149,999. Why would they do that knowing that can get that. Thats false advertisement. That ticked me off. We later found out that sometimes banks dont accept offers so they can put the house up for sherriff sale and buy it back at a much cheaper price then resell it and the original loan of course is cleared not costing them anything, just making money

 

[goofy5]

yes, the bank decides if they want to accept or not. Process can take as long as 6mths. I would definately get on your realator (nice guy or not) He needs to be on his game explaining the process

 

[Minnesota!]

We just short saled our house - it closed on 5/6/2009. Long story as to why we short saled it - not much to do with the economy or any irresponsbilities on our part. Just had to get that out there so people don't question me

Anyway, the offer was made on our house on 12/8/2008 (got the call while we were at Akershus having lunch for my DH's birthday!). Went back and forth with the mtg company and finally end of April they agreed to take that much less (almost 80K) than what we owed them. We closed 5/6.

Painless process...but LONG. Ours was not in foreclosure, we just needed to unload it ASAP as we could no longer live there. So we opted to sell it at a loss rather than have the bank repo it.

If you really want the house, I would wait it out.

 

[TheRustyScupper]

I appreciate your first-hand experience; thanks, again. We are a cash buyer, so I hope that helps.

1) For Short Sales, a pre-approve mortgage is considered a cash sale.
2) One should NEVER make an odder on a Short Sale without cash or pre-approval.

 

[DisneyMomOK]

:::