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Old 03-25-2011, 10:14 AM
 
Location: Charleston, SC
5,615 posts, read 12,789,652 times
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Quote:
Originally Posted by MaseMan View Post
Wow, they sound like real winners.
Basically... it was an interesting history looking at the county deed records to see yet another refinance or HELOC every year to 18 months. Unfortunately for them a lot of the addition was ill-advised (probably designed without the help of an architect or designer, and the layout reflects that), and too personalized. But for us the place reflects the right amount of square feet in great structural condition at a much lower $ / square footage than can be had elsewhere. For me it's a blank canvas that I can create something from.
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Old 03-28-2011, 03:09 PM
 
Location: Boston Suburb
2,071 posts, read 5,302,141 times
Reputation: 1600
Quote:
Originally Posted by mmyk72 View Post
Mid Dec 2010: House listed at $400K. Short sell w/ 2 mortgages (possibly same lender). Offer submitted @$373K.
Mid Jan 2011: Received signed acceptance from sellers, got word from seller's attorney that SS application w/ my offer was submitted to bank. Looks like there were no other buyers.
End Feb 2011: Seller's attorney email said 2nd mortgage just approved. So now it's waiting for the 1st mortgage..... to be continued.
Mid March 2011: Seller's attorney said, "bpo was performed, the file is assigned to an underwriter, the senior lien holder indicates it is approx a 60 day turnaround from now
End March 2011: Just received response. Bank (1st lender) countered back at $400K (same as list price). I need to respond tomorrow.

I guess no one can say what the bank is thinking as in whether they are looking for just any increase from me or whether they are firm with $400K.

History: Sellers took out a $360K loan (primary) and a $89.5 K loan (2nd). Purchased the house for $450K in 2006.

Any advice or strategy, please share.

Last edited by mmyk72; 03-28-2011 at 03:24 PM..
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Old 03-28-2011, 11:13 PM
 
Location: Dana Point
143 posts, read 383,517 times
Reputation: 153
The first question is, who is the bank or banks? At $400,000 the 1st is paid off completely and the 2nd gets whatever is left over, should the 1st foreclose.

What did the 2nd approve? How much money are they agreeing to accept to step off the property - and what are they expecting the 1st to agree to?

If they have a bpo, they are likely going to want to keep it at that price for awhile to see if it will sell for that. You can certainly offer a lower price and see how they respond. That said, I had one last year where the buyer refused to increase his price - he was a cash buyer, and the home was in dreadful disrepair - and the bank took it.

Short sales are a never-ending supply of changing rules.....
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Old 03-29-2011, 06:46 AM
 
Location: Boston Suburb
2,071 posts, read 5,302,141 times
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No details from seller's attorney who handles all communication with the bank on what the terms are for the 2nd approval. Bank is a smaller institution called Lendia (not WF, BoA, Chase, etc).

Also a cash buyer here. House is in good condition.
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Old 03-29-2011, 07:14 AM
 
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Found a short sale in Central FL we liked about 8 days ago. Met the sellers asking price and had an approval signature from them the next day. Supposedly the listing agent submitted to the bank the following day.

There are two concerns of mine:

1. It's a BofA short sale.

2. A little history, supposedly a BPO was done a few months back and was approved at the asking price. Potential other buyer backed out of the deal because they felt it was too long. Also there was a paperwork debacle another reason they backed out, see number 3.

3. Home owner passed away during the short sale process, now property is in the hands of the kids. Bank had trouble understanding the situation, a lot of back and forth was involved. The listing agent assures me and my buyer agent that the bank is on board and all paperwork has been clarified this time around.

My wife and I are keeping our fingers crossed, I know it's going to take time but I feel like the sellers and myself moved the paperwork as fast as we could back to the bank. Not much more I can do on my end.
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Old 03-29-2011, 11:46 AM
 
Location: Dana Point
143 posts, read 383,517 times
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mmyk72, it is really hard to give you advice on what to expect when I don't know the basic information. I do quite a few short sales here in CA on a regular basis, representing both buyers and sellers. I don't think you say what state you are in, so my advice might be useless.

The usual process with a 1st and 2nd is that the 1st analyzes the offer and, assuming they accept it as written, decides how much money they will receive on the sale. They then make an offer to the 2nd somewhere around $3000-$5000. The 2nd usually says "no" and goes to the seller and/or buyer and asks them to give additional funds. If that doesn't work, they often refuse the offer and the home goes back on the market.

The usual sequence is that when the seller has turned in all of his paperwork to see if he qualifies for a short sale, along with the offer, the file is turned over to a processor who gets the file together. Once the processor is done - this is the longest process - it goes to the negotiator who responds quickly and gets things completed one way the other. I am completely lost as to how the 2nd can really approve anything until the 1st completes his part.

I am in a non-recourse state and do my own negotiations on my ss listings.

My point is that you really don't have any idea what will happen. The 2nd can kill the deal. The 1st and 2nd can kill the deal by requiring that the seller allow them to pursue a deficiency judgment after allowing the short sale. Either lender can give you a counter offer that you aren't willing to pay, etc.

Sorry, but good luck!!
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Old 03-29-2011, 03:29 PM
 
Location: Boston Suburb
2,071 posts, read 5,302,141 times
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LisainCali - Thanks for your input. I'm in MA btw. Yes, kind of doesn't make sense to get a message saying seller's 2nd loan approved, that's before any other info on what the 1st says. The seller's attorney conveyed that to us, so unlikely it's made-up though. Both 1st and 2nd are with the same bank. I'm a bit wary that the 2nd might change it's mind after we come to an agreement with the 1st.

Looks like the negotiator has been assigned (3 months of processing is over) and the initial contact from the 1st lien was that $400K counter offer (at full list price).
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Old 03-29-2011, 03:51 PM
 
Location: Charleston, SC
5,615 posts, read 12,789,652 times
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So now the fun begins...

Now the second has everything they need to make whatever decision they'll come to. They're so far from ever seeing a dime out of this sale it's not even funny, and they're the same bank as the 1st.

We're already paying just a bit more than we probably should because of a unique feature the place has (3 car garage with high ceiling), but at this point we're looking at other listings to have a backup in case the bank comes back wanting more. The entire time the seller's end has kept saying "it's preapproved" but it might not be as preapproved as we've been led to believe. If bad comes to worse and the 2nd wants more cash, there's always the option of finding another house in the neighborhood and doing an addition.

Off to look at about 90 listings in the area that were forwarded to me this afternoon... gotta love the internet.
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Old 03-29-2011, 07:40 PM
 
Location: Charleston, SC
5,615 posts, read 12,789,652 times
Reputation: 2534
After reading and re-reading LisainCali's post (thanks for being so informative!) and pursuing all of these listings we have an alternative. Somewhere smaller and cheaper that we could build an addition to the house and garage onto that all things considered, should come out about the same. Best of all, it's also not a short sale and the owners have already moved out.

So it looks like if there are any more delays or the bank wants to play around we'll be more than ready to move on. The contract was written so that we're already able to at this point.

FWIW South Carolina is a recourse state... not sure what it means for us as buyers or the bank(s) screwing things up for either of us.
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Old 03-29-2011, 09:32 PM
 
Location: Dana Point
143 posts, read 383,517 times
Reputation: 153
mmyk72, I don't think what the attorney said about the 2nd being approved is made up. BUT, I also have no idea what it means because it doesn't really make sense.

Look, after my interview with a client before taking their short sale listing, I have a pretty good idea about whether or not it is likely to be a success. If I take the listing, I make everything as easy for the bank as possible. On their paperwork, in the order they ask for it, and I prep my sellers to have a box where they toss bank statements, tax returns, paystubs, 1040's, etc. that I KNOW the bank will want updated every couple of months or so.

But here is the problem when I represent buyers. We often have no idea how knowledgeable the sellers agent or negotiator is. And we have no right to personal information about the seller, or his loan, etc. We hope for the best, and negotiate and purchase in good faith, but I keep reminding them of the cold, hard facts that 60% of short sales fail.

So if you were my buyer, I would advise you to keep looking at other homes throughout the entire process. You might find a better home for a better price and won't be waiting around.

Again, this advice might not be relevant in other states, but in California the buyers earnest money deposit check is not cashed until both the buyer and seller have agreed to the lenders terms.

I hope it works out for you.
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