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Listing agent is asking me $500 check to submit the complete short sale offer package to the bank? why is that and is it refundable? Bank is Wells Fargo. Does anyone have any experience dealing with them?
You pretty much always submit some money when making an offer. It shows that you are serious about the transaction. It is generally refundable if a contract is not signed or if a contract is signed for any number or reasons that would be spelled out in the contract.
You shouldn't be paying any money that isn't outlined in the contract. Assuming you are the buyer, and that you are talking about Earnest Money, that is very normal, and the terms under which it is refundable would be in the contract.
Listing agent is asking me $500 check to submit the complete short sale offer package to the bank? why is that and is it refundable? Bank is Wells Fargo. Does anyone have any experience dealing with them?
It's normal. As mentioned, it's an earnest money deposit. However, if you're approaching this as a standard transaction, you may want to reconsider.
Banks have developed a reputation for gaming short sale buyers. How many days does the bank require your offer to be valid for? What are their stipulations for financing?
As a rule, I say stay away from shorts unless you're an experienced investor who doesn't expect the deal to close anytime soon.
You should go with your agent's advice but, as a general rule, most offers are made with some amount of money as an earnest money deposit that goes into an escrow account. Where I am, there has been a trend with short sales to not have the buyer offer any earnest money at all or only once the seller's lender(s) has approved the short sale, so to speak. Personally, I don't like that for either party. I understand the logic but a contract on a short sale is really just a contract with a lender's approval contingency and, just like any other contract, I like to have both parties "invested" to some degree so neither will arbitrarily back out for no reason. However, a buyer does not have to provide an earnest money deposit at all for any purchase contract -short sale or otherwise-so you certainly don't have to do that. If the seller is willing to run the risk that you will not walk away because you have no money in escrow, that's up to them. The listing agent is probably saying that the lender will be more willing to process the offer if there is evidence that you are not, as I said before, likely to walk away because you could lose your deposit. They don't want to do the work unless they know you are really going to stick it out. If you want to provide the deposit, it should be going to an escrowed account and your contract should describe all of the conditions by which you could lose the deposit IF you violate the contract. Hope that's all clear!
You should go with your agent's advice but, as a general rule, most offers are made with some amount of money as an earnest money deposit that goes into an escrow account. Where I am, there has been a trend with short sales to not have the buyer offer any earnest money at all or only once the seller's lender(s) has approved the short sale, so to speak. Personally, I don't like that for either party. I understand the logic but a contract on a short sale is really just a contract with a lender's approval contingency and, just like any other contract, I like to have both parties "invested" to some degree so neither will arbitrarily back out for no reason. However, a buyer does not have to provide an earnest money deposit at all for any purchase contract -short sale or otherwise-so you certainly don't have to do that. If the seller is willing to run the risk that you will not walk away because you have no money in escrow, that's up to them. The listing agent is probably saying that the lender will be more willing to process the offer if there is evidence that you are not, as I said before, likely to walk away because you could lose your deposit. They don't want to do the work unless they know you are really going to stick it out. If you want to provide the deposit, it should be going to an escrowed account and your contract should describe all of the conditions by which you could lose the deposit IF you violate the contract. Hope that's all clear!
Thank you and listing agent is asking to make the check out to seller's name.
I don't understand that request at all. Are you using an agent for your side of the deal? It sounds like they want to use an attorney for the short sale negotiation and the seller can't afford it. It's up to you but there's no way I'd write THAT check.
Thank you and listing agent is asking to make the check out to seller's name.
This does not make sense. Don't you have a buyer's agent? The check (earnest money) is usually made out to the buyer agent's company.
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