[SoFLGal]

Another thing that many people don't realize about short sales is that the banks often send a local Realtor in the area to do a CMA. Once they receive an offer they send the Realtor out to do what is called a BPO (brokers price opinion). The Realtor must have no connection with the sale of the home and they are generally paid around $150 for their BPO. We have found that the banks are not coming down more than a few thousand dollars from the BPO. So really it all hinges on what this agent says the home is worth. If the Realtor comes back with a lower BPO you might get a deal and if it comes back higher you can just hang it up. They also take into consideration what is owed on the mortgage. If there is a first and second mortgage often times the first gets the bulk of the money and the second may get $1000, if that.

If it is a large mortgage company you are dealing with there may be one agent handling 3,000 or more files and many of the companies are located out in California. If you/your Realtor are not available to answer the phone when they get around to your file that you have made an offer on it goes back to the bottom of the stack and you might not get another call about the property you've made the offer on for several months. Remember, since it's California time you may get a call at 8 pm on a Friday night when you are sitting down to eat dinner. If you don't have the payoff amount, loan number, etc ready you're done for a few months.

Also, if you were to deal with an owner on your own without a Realtor you would have to get a letter from the property owner authorizing you to talk to the bank on their behalf or they can't speak to you.

If it is a foreclosed property and the bank is "holding" a lot of property they might be somewhat more willing to negotiate as well.

[heydade]

Originally Posted by cflfan

I hope i can offer some helpful advice without being shot down as usual by people who say ALL realtors are looking after their own interests and dont care about anyone but themselves, some of those people and you know who you are who contribute to most of the threads including this one. To start with a Short sale typically isnt deal with by the banks. A short sale is still controlled by the Sellers. The only difference being, a seller may have bought a home for $400,000 when the market was at its peak. They financed the whole amount, and in the current market it may only be worth $300,000. In this instance the sale would not pay off their mortgage by a large sum. So they speak to their lender and negotiate an amount a lender would accept to satisfy the loan knowing that currently the property wouldnt sell for the full loan amount. The amount that is the difference, in the loan and the value which the lender will accept is known as the short and the lender will write this amount off. So if you go and put an offer which is alot less than the listed price on a short sale, you are unlikely to be successful. Now foreclosures in the past have been typical different. You could put in a stupid offer with a chance in securing a property, simply because lenders dont want to have a huge inventory of homes which are doing nothing for them. However, in my experience in the current market, you will find that on the whole, lenders wont let the properties go for crazy , prices, whether you agree or disagree, its the way it is. If you have been lucky to get a STEAL, and i do mean a STEAL, then good for you and im very happy for you.
Dealing with short sales is hard work, typically there is alot of work involved and waiting for lenders to get back can take time. If your one of the know it all's which we see alot on here who think that Realtors are all bad blah blah blah, then i would strongly recommend negotiating yourself and doing all the paper work yourself. You obviously have strong feelings about ALL of us and no amount of common sense, or friendy chat will change your opinion. If you dont feel confident etc, then use a realtor. It takes all the hard work out of it and it doesnt cost you a thing.

Seems like you have not done any short sales. BANKS CONTROL THE PROCESS. The seller does NOT negotiate with the bank on the price. The seller with the help of his real estate agent accepts any and all offers which are then forwarded to the lender. The lender may take up to 3 months to decide on which offer they will accept....in the meantime, you know nothing and are just sitting there with your thumb up your behind...waiting...wondering. Then the bank will come back and tell you if they accepted an offer and what it was for. That's how it works with MOST banks.

[heydade]

Originally Posted by SoFLGal

Zillow as a whole is not very reliable. I have seen some things close and others things way off. We have had people looking to list their homes and they showed us a Zillow sheet that was over $100,000 off. If you ask me that's a pretty big margin of error.

Look on the local property appraisers website and search what the homes sold for. You can go down a street and look at the solds. You won't get an average unless you do it yourself but it's a lot more accurate. Or of course, if you really wanted to know you could call a Realtor. They have access to all of this info at the touch of a button.

Zillow is WAAAAYYY off...believe me. Zillow bases most of it's calculations on the price last sold if recent. It cannot keep up with the alarming sharp decline we are facing month after month.

Zillow is worthless right now..believe me.

[heydade]

Originally Posted by SoFLGal

I've seen appraisals done and then the next month they are no good anymore because the values continue to drop so rapidly..

SMART GIRL. VERY VERY TRUE....APPRAISALS ARE BASED ON WHAT ?? They should be based on what the BUYER is willing to pay. The prices are declining rapidly every MONTH. Maybe that's why many homes are just sitting there.

[cflfan]

At the end of the day people will be insulted when you lowball because that is their home, they have memories in that home, of their family etc etc. However, the intangible things which give your home value to you wont give any value to buyers. I say to my sellers, dont be offended, its just the way it is, and for my buyers, i say to them to offer what they are willing to pay for that home. What is the worse that can really happen. But i do say to them, offer what you would be prepared to pay today in this market, dont pick a number and divide it by 2 and submit that because firstly, it isnt a sensible offer regardless of what people on the forum say, and will only annoy the sellers even more, and secondly it shows you arnt really serious. Put in a decent offer, but even if it is 20% lower than the asking price, put in other contingencies to make it attractive, like a good size deposit if they accept, financing in place, a fairly short time period to have all the inspections completed and close on the property in a timely manner. You would be surprised how often a low ball offer will be accepted if other terms are put in to show this is a serious buyer who is already pre qualified, has financing in place and is ready to buy your property. Hey, if the seller doesnt counter and rejects the offer totally, move on to the next property, there are plenty out there and if you really wanted the property then you wouldnt have put in a price that equates to half the list price.

[heydade]

Originally Posted by cflfan

At the end of the day people will be insulted when you lowball because that is their home, they have memories in that home, of their family etc etc. However, the intangible things which give your home value to you wont give any value to buyers. I say to my sellers, dont be offended, its just the way it is, and for my buyers, i say to them to offer what they are willing to pay for that home. What is the worse that can really happen. But i do say to them, offer what you would be prepared to pay today in this market, dont pick a number and divide it by 2 and submit that because firstly, it isnt a sensible offer regardless of what people on the forum say, and will only annoy the sellers even more, and secondly it shows you arnt really serious. Put in a decent offer, but even if it is 20% lower than the asking price, put in other contingencies to make it attractive, like a good size deposit if they accept, financing in place, a fairly short time period to have all the inspections completed and close on the property in a timely manner. You would be surprised how often a low ball offer will be accepted if other terms are put in to show this is a serious buyer who is already pre qualified, has financing in place and is ready to buy your property. Hey, if the seller doesnt counter and rejects the offer totally, move on to the next property, there are plenty out there and if you really wanted the property then you wouldnt have put in a price that equates to half the list price.

Cliff...what are of south florida do you specialize in if you don't mind me asking ?

[SoFLGal]

Originally Posted by heydade

Seems like you have not done any short sales. BANKS CONTROL THE PROCESS. The seller does NOT negotiate with the bank on the price. The seller with the help of his real estate agent accepts any and all offers which are then forwarded to the lender. The lender may take up to 3 months to decide on which offer they will accept....in the meantime, you know nothing and are just sitting there with your thumb up your behind...waiting...wondering. Then the bank will come back and tell you if they accepted an offer and what it was for. That's how it works with MOST banks.

You are right on with this post. That's pretty much exactly how the process works. We have been waiting since late October for an answer back on an offer we submitted on a short sale.

[cflfan]

Perhaps you should check this quote out heydade
"There are many ways to lose a home but signing away ownership in a manner that destroys credit, embarrasses the family and strips an owner of dignity is one of the hardest. For owners who can no longer afford to keep mortgage payments current, there are alternatives to bankruptcy or foreclosure proceedings. One of those options is called a "short sale."
When lenders agree to a short sale in real estate, it means the lender is accepting less than the total amount due. Not all lenders will accept short sales or discounted payoffs, especially if it would make more financial sense to foreclose; moreover, not all sellers nor all properties qualify for short sales"

The reason why the seller IS STILL IN THE MIX is because the list price of the property is what the bank will accept to satisfy the mortgage, however, if someone tries to low ball that, the SELLER can still counter to achieve an amount where by they can make up the short fall if it is not too much. So if a property is listed $300,000 on a short sale and buyer offers $260,000, a seller may say if i can get $280,000 i can personally afford to find $20,000 to closing to satisfy the loan and be done with it all.

That is why a Seller IS still in the mix. Your right if you mean, a short sale is agreed to and put in place with the assistance of the lender, but if you think that the Seller has nothing more to do with it then you are wrong. In that scenario when the seller has nothing more to do with the selliong process, then you are in foreclosure, and the lender engages the realtor and the buyers negotiate only with the lender and the owner of the property has nothing more to do in the transaction.

[cflfan]

Central Florida, the Orlando area

[heydade]

Originally Posted by cflfan

Central Florida, the Orlando area

oh..very nice. I heard that Lake Mary was rated as one of the best places to live in the United States. Nice area.