Lowball / Short Sale Strategies (mortgage, lawyer, real estate)

[Wendyb0077]

Due to privacy acts, the Lenders are only supposed to speak to the person(s) that are on the loan. The seller has to deal with the lender until the lender gets back the loan and the seller is out of the picture. When the sellers gets these low offers and they get fowarded to the lender via e-mail, fax or whatever, the Lender will take there time to see if it is worth to take the contract or not. They don't care about contract dates or anything else except their bottom line. They are not going to just jump and take a low offer. It is a different story when the Lender ends up with the property. At that point all is fair game so let the offers fly! The Lenders do not want to be in the Real Estate Business. That's when you can get the best deals.

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.

[cflfan]

Your right, Lake Mary is very nice, its a great area to live if you need to commute between Orlando and Daytona. Otherwise i find its a bit out of the way. On the map it looks pretty close, but when you have to drive it, esp with rush hour traffic, its a hike. I specialize and recomend Winter Garden. Thats where i live and we love it.

But to give you my honest thoughts on the whole foreclosure short sale fiasco for want of a better name, a high percentage of properties on the market ARE over priced. When i give a listing presentation, and i had one last week, i go in with all my literature, armed with my CMA i show owners what their home is worth currently. at least 8 out of 10 disagree with me, and i show them what is listed currently in their area and how long its been on the market. The statistics speak for themselves. ALOT of realtors (which annoys me because it gives us decent ones a bad name, and alot of people on the forum lump us all together) will list a property at whatever a buyer wants just so they have a full website. Realistically they wont sell and it just makes propspective clients think they are busy. I am in the business to sell properties. If i list a property that is over priced, it wont sell, so i wont get paid, and i have to pay for advertising etc, etc. Its not worth my time taking the listing. I tell sellers, if you list at this price you will sell. If you list at your price, you will stay. Its not me saying that, its all the overpriced listings that have been on the market for along time that say that. Then after a while, when a realtor who listed a property at the wrong price cant sell it, and the owners are about to go into foreclosure, you will see the same property being listed on a short sale for alot less than what i would have listed it at.

It is sad and i know alot of realtors have behaved badly and given us good ones a bad name, but if you do your homework and select a good realtor, then we will steer you right and you might not end up having to go through a short sale or foreclosure, simply because of either greed or stubborness.

Just my humble thoughts on the situation.

As for your comment previously, i have been through a number of shorts, and in all honesty, none of them have completed simply because in the time it takes the lenders/sellers to get back to you, my clients have found other homes at the right price for them, without all the aggravation a Short sale has

[heydade]

Originally Posted by cflfan

Your right, Lake Mary is very nice, its a great area to live if you need to commute between Orlando and Daytona. Otherwise i find its a bit out of the way. On the map it looks pretty close, but when you have to drive it, esp with rush hour traffic, its a hike. I specialize and recomend Winter Garden. Thats where i live and we love it.

But to give you my honest thoughts on the whole foreclosure short sale fiasco for want of a better name, a high percentage of properties on the market ARE over priced. When i give a listing presentation, and i had one last week, i go in with all my literature, armed with my CMA i show owners what their home is worth currently. at least 8 out of 10 disagree with me, and i show them what is listed currently in their area and how long its been on the market. The statistics speak for themselves. ALOT of realtors (which annoys me because it gives us decent ones a bad name, and alot of people on the forum lump us all together) will list a property at whatever a buyer wants just so they have a full website. Realistically they wont sell and it just makes propspective clients think they are busy. I am in the business to sell properties. If i list a property that is over priced, it wont sell, so i wont get paid, and i have to pay for advertising etc, etc. Its not worth my time taking the listing. I tell sellers, if you list at this price you will sell. If you list at your price, you will stay. Its not me saying that, its all the overpriced listings that have been on the market for along time that say that. Then after a while, when a realtor who listed a property at the wrong price cant sell it, and the owners are about to go into foreclosure, you will see the same property being listed on a short sale for alot less than what i would have listed it at.

It is sad and i know alot of realtors have behaved badly and given us good ones a bad name, but if you do your homework and select a good realtor, then we will steer you right and you might not end up having to go through a short sale or foreclosure, simply because of either greed or stubborness.

Just my humble thoughts on the situation.

As for your comment previously, i have been through a number of shorts, and in all honesty, none of them have completed simply because in the time it takes the lenders/sellers to get back to you, my clients have found other homes at the right price for them, without all the aggravation a Short sale has

Yes....everyone seems to think Short Sales are the answer and you are 100% correct....they are actually a major hassle that most real people looking to buy a house would rather not deal with. It's like buying a nice car and having to wait 3 months to get it..who wants that ?

[cflfan]

Just an example of what concerns me heydade, was when you posted that response, saying i was wrong about the whole short sale process, a realtor agreed with you and said that was what she was going through. Whilst i agree with you 100% about the hanging around waiting for nothing, and the hassel of it all, i hope that is what she was agreeing to and not the other issues we were discussing. Because, if she was agreeing to the other aspect and she is dealing with clients and she/he is under that belief, i wouldnt want to be their clients....lol

[skrischke]

As a Realtor-here is an honest answer.

Your offers of 50 cents on the dollar will NOT be accepted by the banks. This is because we are not at that point yet. There are still people (bless their hearts) that are buying at the current prices. What you need to do is educate yourself on SALE prices for similar homes to what you are interested in. Banks have brokers who do BPO (Broker Price Opinions) for them, and this is where they determine the sale price, bank typically reduce the price a certain percentage (depending on policy of that bank) each week that it sits on the market. But as you educate yourself (i.e. PSL we are seeing $150K as the "magical" number right now) when houses get to that point on a newer home or an older pool home it would be about $110K...this is the figure where we see it sell in 24 hours or go into a multiple offer situation.

So, by all means, if you see a foreclosure listed at $200K, feel free to offer 1/2 that, you may get it for 3/4 of the ask price...who knows. But most foreclosures are being priced pretty competitively right now. Playing the market, to try adn get a house for 50 cents on the dollar, that we are already seeing in short sales, but 2 things to be aware of:

#1. that ratio is based on the price they paid and owe versus what they can get ont he market...you are not going ot get it for 1/2 of THAT price, too! Make sense? If you want 1/2 THAT value, you will have to wait another year, I think.

#2. Not all sellers qualify for a short sale, so even though they have the house on the market in short sale position...the bank will never accept it, if they have assets, or have not shown hardship, etc...there are many variations)

Moderator cut: comment
Were you inthe market in the late 90's when we saw all the HUD homes for sale (they were pennies ont he dollar)...I remember selling a 3/2 house that was roughly 6 years old, had a nice corner lot and needed minor cosmetic work (from being vacant so long) and new landscaping for $26,000!! In PSL, you can barely buy a vacant lot for that price rightnow!!!! That time IS COMING, and that is what I am waiting on, not going to miss the boat this time around!

There have been 3 houses sold in Ft.Pierce (that is in a great rental area) for $33K, $13K, and $15K....talk about a great positive cash flow...when you can rent it out for $600/month (allow section 8 & guarantee your money, if you want), the mortgage is paid off in 3 years, and then all is net income. You deduct your taxes and insurance, and then whent he market comes back, you fix it up and sell it for pure profit...talk about a gold mine!

Best wishes, stay in tune ot market in the area you want to buy, and you'll succeed with your offers (eventually)!

[SoFLGal]

Originally Posted by cflfan

Just an example of what concerns me heydade, was when you posted that response, saying i was wrong about the whole short sale process, a realtor agreed with you and said that was what she was going through. Whilst i agree with you 100% about the hanging around waiting for nothing, and the hassel of it all, i hope that is what she was agreeing to and not the other issues we were discussing. Because, if she was agreeing to the other aspect and she is dealing with clients and she/he is under that belief, i wouldnt want to be their clients....lol

I was agreeing to the fact that the process is a long and drawn out ordeal, which is what heydade was explaining in the post. I'm not sure what other aspect/belief there was in that post that you are referring to.

[cfIfan]

the point being made was the inaccuracy that the banks deal with the whole process, because they dont. An agreement is made between the seller and the bank pertaining to how much the bank will accept to cover the loan. The seller is still for the most part in control of the sale. the only time they are not in control of the sale is in a foreclosure. I thought thepoint you were making relating to how the process works, because if that was the case then you would be incorrect. You are right though as heydude already agreed, short sales are a pain and for very little benefit to buyers esp in this market because with a little hard work you can find good priced properties at the same if not lower rates than short sale properties

[Hero]

Originally Posted by heydade

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.

While I agree Zillow's zestimates can be way off, my original question was if "2005 peak" price is accurate. Zillow may be incorrect when it comes to estimates of individual houses. But it has graphs of properties averaged by state, county, city, and zip code. Based on these graphs, the actual peak for florida is 2006-2007.

Maybe I'm still misunderstanding. As inacurrate as zillow is to give present estimates, I've always considered the graphs as actual documentation of past prices.

Sorry to be offtopic. I'm trying to figure out what people mean when they say 50 cents to a dollar from the 2005 peak. Don't you mean 2006-2007 peak?

[jbravo]

Posted this in another thread in reply to a question; actually better placed here:

--------------

Banks are asking 25% off the insane "lets buy anything" ridiculous selling prices of 2005.
The houses were in a neglected, sorry shape.
There were no deals that I saw.
Yes, some might bite; and regret it afterwards.


Most ironic moment of the tour: when the tour guide told us that the last owner of the house we were going to see in Abacoa in Jupiter was an agent in her company who had lost the house to foreclosure.
Should add that I have nothing negative to say about the tour itself and would recommend it to anyone unless you suffer from a compulsion to buy.

Spoke to many brokers in the area, buyers are offering 45%-50% off the asking prices, and are adamant that the broker present the offer (which they are obligated to do.)

Desperation and despair everywhere, and bound to get worse.
You see the fear in peoples eyes, most are still in denial.

This will take time.
----------

Great thread, thx Muggy.

[Wendyb0077]

Saw your post on the other thread, thanks for the first hand account!!!

Originally Posted by jbravo

Posted this in another thread in reply to a question; actually better placed here:

--------------

Banks are asking 25% off the insane "lets buy anything" ridiculous selling prices of 2005.
The houses were in a neglected, sorry shape.
There were no deals that I saw.
Yes, some might bite; and regret it afterwards.


Most ironic moment of the tour: when the tour guide told us that the last owner of the house we were going to see in Abacoa in Jupiter was an agent in her company who had lost the house to foreclosure.
Should add that I have nothing negative to say about the tour itself and would recommend it to anyone unless you suffer from a compulsion to buy.

Spoke to many brokers in the area, buyers are offering 45%-50% off the asking prices, and are adamant that the broker present the offer (which they are obligated to do.)

Desperation and despair everywhere, and bound to get worse.
You see the fear in peoples eyes, most are still in denial.

This will take time.
----------

Great thread, thx Muggy.