North And Northwest of Chicago Real Estate : Dear Approved Short Sale Buyer

Dear Approved Short Sale Buyer

I have shown many short sale homes here in the area and only one of them was approved out of ten. Here is a short summary from both sides, as a listing agent and as a buyer's agent on an approved short sale

One of my listings was approved not too long ago and the bank was asking X amount of money. Since a short sale is a long, long process you will find that the approved ones are on the market way longer than a 100 days and most probably they had previous offers. Let's say the first buyer went away and now the property could sell much easier and quicker if the next buyers is listening to what the agents have to say. Since the property was approved for a short sale the listing agent changed the price accordingly. They may not even change the price because they already did their homework some time ago and they priced it right.

Since I'm a listing agent I will tell your agent that the property is approved and what the bank wants .... let's say $100,000; to make it even and easier to calculate the percent of the offer in this example. I will communicate to your agent that there is no room for negotiation because it was approved recently. You can send an offer of $75,000 and waste our time, but nothing will happen. Maybe in a year, if there were no offers in the mean time.

Remember, the number above that the agent already told you is the number they are looking for and it was $100,000. Then you decide to send an official offer of $80,000 .... guess what will be the answer. The bank is willing to accept $97,000 and you walk away.  No kidding .... I told you what they are looking for, and you went to see that property a few more times, because your client thinks that the short sale means much cheaper and way easier to negotiate.

Recently I was with a buyer who was offering 25% less to an approved short sale. The listing agent told and wrote what the bank was looking for ....

If you are buying a home today, short sale does not mean more room to negotiate. If you are not in a hurry we can keep waiting while the home you really like has already gone for the fair market price. It was ready to move in, if you know what I'm saying.

It could simply be that you just missed the regular sale of a similar home down the road.  

Short Sale Approved? It's approved to sell for the price that many people agreed on, before we even knew that it's on the market.

I may have just lost a buyer, but who knows... maybe he's happy to stay a renter.

 Haris Dedic, Realtor®, SFR, SRES

With RE/MAX Villager

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Comment balloon 3 commentsHaris Dedic • December 11 2010 07:51PM

Comments

It is a trend with all the banks I am working with that they are approving things faster, but at higher prices. They do not view short sales as distressed properties.

Posted by Marcy Moyer, Probate, Trust, and Investment Specialist (eXp Realty of California Silicon Valley Probate, Trust, and Investment Sales) almost 9 years ago

Great post, i thought i was the only one facing these issues. It is so true.... The reality is teh bank is going to approve short sales at or just below market value, they are not approving them for half off. It bugs me more to see short sales listed at half price, that will never never be approved. It puts a bad name on short sale.

Posted by Scott Godzyk, One of Manchester NH's Leading Agents (Godzyk Real Estate Services) almost 9 years ago

The buyers I have been meeting do seem to think that short sale means really drop the price.  It has been a challenge to get the buyers to understand and then after you explain it to them some still ask what is taking sooooo long.  I agree with Scott, it bugs me too when I see a short sale that is obviously priced way too low and you just know the bank is not going to give half off market value....sort of a waste of time.

Posted by Cynthia Grimes, "With You Every Step Home!" (eXp Realty, LLC) almost 9 years ago

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