I am in the market for a home and ran across a home listed by a realtor. It states that it is approved for short sale by the lender. The asking price is 220,000. The properties in the area are about the same price.
Does this mean that since it is "pre-approved" the wait time will be much less? The house has been sitting empty for a year and needs some tlc due to that.
I was considering offering $150,000.
Thoughts???
That depends....
I don't know too many senior mortgage lenders who disregard the application and approval process....
Many homeowners and realtors alike think because a lender advises it will consider a short sale as a non foreclosure alternative (standard, boilerplate verbage)
it is a streamlined 'preapproval' which it is not.
However, many junior lienholders have relaxed criteria and can smell the coffee.
I would ask the listing agent if any other offers have been submitted and rejected, and how the asking price was determined.
It could mean a couple things . . .
First, that the bank is willing to look at a short sale.
Second, that the approved price is 220k.
My guess is that the Realtor has it listed for what the homeowners need to cover their balance and that the bank hasn't approved a final number.
If you are depending on the Realtor to do the negotiating, be wary. Make sure that this person is experienced (I haven't met one yet who says that they aren't) and ask to see documentation on past transactions that they've negotiated to confirm they have the level experience that they profess.
A typical buy and hold short sale negotiation will take 3-4 months, if the agent is really good. Otherwise, it can go much longer.
[addsig]
I am a Realtor and I do short sales. I suppose someone could check my track record in the MLS but honestly, I wouldn't show anyone my "past transactions" to validate whether or not I could negotiate a short sale. When in doubt, or when I know a listing agent has little or no experience, I include a clause in the contract that a 3rd party negotiator be use to negotiate the short sale. No hurt feelings or bruised ego and there are tons of experienced short salers that will negotiate a ss for a fee.
So if I am interested in this property and it is "pre-approved" it is more than just putting in an offer and waiting for reply? What types of negotiating would have to be done?
My current realtor/buyers agent does not like short sale deals.
[ Edited by Skydiver on Date 05/06/2008 ]
I'm a Realtor that does ONLY short sales. It's possible the bank has pre-approved that price. That doesn't mean they still won't consider less. Offer the 150. That "pre-approved price " was probably approved a year ago or the realtor wasn't savvy enough to meet the bpo person to influence it downward. Take pictures of needed repairs, get high contractor estimates to fix, check for sex predators in the area, point out the dangers of vacant housing, how long it's sat with no tangible offers, run some low comps and submit it all to the lender. Vacant for a year, the lender is most likely also the owner so its not really a short sale but a distress sale since the bank owns, but doesn't want the house .