[dsdeena]

Hi, I would appreciate any help with this short sale dilemma.

I am trying to buy a home that was listed as short sale at 255K. There was already an offer for $251K by some other buyer who eventually walked away before even Bank approved the offer. When I wanted to make an offer, the selling agent suggested me to make an offer at 251K so that they can just wait for the Bank's response for the $251K that was made by the previous buyer.

Anyway, after I made the offer at 251K, within a couple of days, my agent says that the Bank rejected the offer. Now when I asked for a written proof of the rejection, the selling agent says (thats what my agent told me) he just talked to the Bank on phone and doesn't have a letter showing the rejection. The selling agent asked me to increase the offer while he relisted the home at 261K now. Even though he has relisted it at 261K, he still insists me to offer more than that, otherwise the bank may not accept it.

I am totally confused and find it a bit goofy.. Is it possible that the Bank would not send a letter about rejecting an offer? Plus, why would he relist it at 261K, if he isn't sure the bank will accept it.

The previous sale price on this home was 290+K in 2006. Any suggestions how I should approach? I am planning to start with a new offer around 257K but I am not sure, if I should increase so much (251 to 257K? ). And what is best way to negotiate this one? Is it possible that the selling agent is just trying to extract more money from me while the bank may have accepted the offer (because he knows I am really interested in this one). Please advice.

Thanks

[Fr_Chuck]

Welcome to real estate, he may have no idea what the bank will or will not accept, they may refuse 260 today, but accept 250 next week.

No they do not send out rejection letters they merely do not sign the offer sent to them and send it back, actually they normally don't even send it back but just call the agent and tell them.

And yes then the selling agent will tell your agent.

It is almost always best to work direct with the sellng agent on a short sale, most short sales restrict the commission that can be paid, so buyer and seller agent have to split a very very small amount.f

But if they refuse the one offer, you can offer a little more, The listing price can be rejected on short sale offers.

[ScottGem]

Is the bank the owner? If not, you are dealing with the owner. If the owner is trying to get a short sale, its he who has to get the approval. Remember a short sale means that the bank is going to lose money since they are forgiving the difference between the sale price and the balance owed.

[stevetcg]

another thing to remember is that the asset manager for the property works for the bank so he is concerned with getting the most money for his boss. The selling agent has very little say in the price the bank approves and is responsible to his clients to present whatever offers are made. If the bank approved your offer and then the selling agent lied to you, he would very likely be in risk of losing his license.

The asset manager reviews offer after offer on possibly hundreds of properties. He probably won't remember your offer so if you made another, it would be handled as a separate offer, not negotiation.

Listing agents list short sales low hoping to attract more attention. What the house lists for, what its worth/appraises for and what offer is ultimately accepted are all independent of each other and frequently have little to do with each other.

I am looking at two properties in Florida. Identical homes, same model, lot size, everything. Both are short sales, one is in immaculate condition and one is trashed inside, needs all new carpet, paint, plaster work and the appliances might need to be thrown out they are so gross. The nice one listed for 10 grand less than the trashed one, they both appraised more than list and I offered 30k under list for the trashed and 15k over list for the nice one.

All that for 2 houses that appear identical to the bank who have nothing to go on but an appraisal value and how much is owed on them.

[stevetcg]

Is the bank the owner? If not, you are dealing withthe owner. If the owner is trying to get a short sale, its he who has to get the approval. Remember a short sale means that the bank is going to lose money since they are forgiving the difference between the sale price and the balance owed.

I am seeing a lot of cases now, at least in central FL, where the owner/seller isn't even seeing the offer until it gets approved by the bank. Since ultimately it is the bank that is taking the hit, they have found that the seller's input is fairly useless in the process.

I am not a real estate expert but am spending a disturbing amount of time with my realtor these days in the market for a good buy.

[dsdeena]

Thanks for the replies. It was helpful. I have made a new offer today hoping to hear back from the bank. Another question I have: I wanted to give a much farther closing date (May) with the new offer due to some personal events in the next couple of months, do you guys think that would have any affect on the deal and also how to negotiate so that I can get a late closing date?

Thanks for your replies.

[ScottGem]

Yes I think that would have an affect on the deal. If the bank is accepting a short sale its likely the mortgage is behind. They will want to close as quickly as possible to minimize the losses. It could be a deal breaker.