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We are buying a short sale property. When they made the offer, the sellers agent says there is no competitive offer. Now the seller just signed the contract, does it mean bank will approve it if there is no other offer. I also noticed that, the property is still listed in the market. Is it normal? We haven't given out the earnest money though.
We are buying a short sale property. When they made the offer, the sellers agent says there is no competitive offer. Now the seller just signed the contract, does it mean bank will approve it if there is no other offer. I also noticed that, the property is still listed in the market. Is it normal? We haven't given out the earnest money though.
First, it is very normal that they property is still listed for sale. It will remain so until your offer is deemed acceptablel to the bank.
Second, the absence of a competing offer dosn't guarantee that the bank will accept your offer. It just means that no one else has put in an offer. If the bank likes your offer, they'll accept it. If not, they'll either refuse it or counter.
Different areas will handle the listing status differently with an accepted short sale offer by the seller. Here, the status would be changed to "Active with Contingency (AWC)" to indicate that the contract is contingent on bank approval. The seller would usually take back up offers. There are no guarantees with short sales competing offer or not. About the only certainty is that you will likely end up very frustrated during the process of waiting for the bank to respond.
The bank first has to decide if the seller fits their criteria to allow a short sale, for example, does the seller have sufficient hardship. Then they will review the market value of the property and decide if your offer is reasonable as compared to their market value assessment. Then the bank may decide to accept your offer, counter, or decline to approve it. Hopefully you are working with an agent that can guide our through this process.
Around here, until the bank approves the short sale, the property usually stays listed. However, a stip could be placed in the purchase offer stating that the seller will not entertain or forward other offers to bank during the waiting period.
Yes I agree... The offer better be close to fair market value or you may not even hear and answer from the bank... (happened to us) Does not even matter if it is a cash offer. We put in offer over 1 year ago... the property still show on MLS as "in contingency:" but we never heard back from the bank. Short sales at the least... a needle in the haystack. Buy a foreclosure. When the bank owns the property, they are more likely to do business.
hhe - We made an offer on Sept 22nd on a townhouse in Orlando. We were verbally told that day that the offer was accepted, but JUST received the contract signed by the seller four days ago. Now we are waiting on Suntrust to accept the whole shebang, and after reading these posts I'm hoping I can close before I have to install a wheelchair ramp!!! But we live in NJ and this is such a great opportunity to buy our "retirement" home on the cheap, so trying to find patience. My question to anyone who has been through this is:
- Did you get a lawyer and at what stage? If not, is the process that hard to figure out on your own or do you need one to "CYA"?
- At what point is it too late to back out? When I sign the banks approval?
- Will certain things on an inspection negate the deal and what kind of things would that be?
- Do they have to disclose the Pinecastle Bombing Range? THAT should be interesting, but it doesn't worry me.
... My question to anyone who has been through this is:
- Did you get a lawyer and at what stage? If not, is the process that hard to figure out on your own or do you need one to "CYA"?
- At what point is it too late to back out? When I sign the banks approval?
- Will certain things on an inspection negate the deal and what kind of things would that be?
- Do they have to disclose the Pinecastle Bombing Range? THAT should be interesting, but it doesn't worry me.
Thanx for any info everyone!!!
Whether you get a lawyer or not may depend on what is normal for your area. But if you have specific legal concerns then consulting with a lawyer may be a good idea.
Your other questions should all be answered in your contract. If you don't understand your contract, then ask your agent (if you have one), or a lawyer.
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