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See, that I don't understand... and I don't do it, nor do most of the agents in my area. If there is a contract signed by the seller, the rest are taken as back up offers. You deal with one contract at a time. There is no 'bidding'.
In VA the seller signed every offer immediately (the 90 day wait was for the bank) so I guess they were executed too.
My agent had my earnest money in escrow, and I was able to make offers on a lot of properties (I had 5 at one point).
Apparently in our area this is common. It would be so much better if the process were sped up so you could do one at a time, but failing that, waiting 90 days to hear that you were outbid (as I was almost every time) seems inefficient.
This seems dangerous to me. It is possible that two banks would accept the short at the same time. So you would be committed to purchasing two homes at once. You'd have to pay for two home inspections in order to back out of one contract legally out here.
If you are a Realor putting in multiple offers for short sales for a customer and the customer intends to buy more than one property, go for it. If the customer only intends on buying one property, putting in multiple offers and praying they don't all get accepted on the same day is a violation of the code of ethics.
In my area, this is just as bad as agents who don't mark properties pending when there is an offer signed by the buyers/sellers. The lender approval is just a contingency of the contract just like the buyers finance clause or inspection clause.
In VA the seller signed every offerimmediately (the 90 day wait was for the bank) so I guess they were executed too.
My agent had my earnest money in escrow, and I was able to make offers on a lot of properties (I had 5 at one point).
Apparently in our area this is common. It would be so much better if the process were sped up so you could do one at a time, but failing that, waiting 90 days to hear that you were outbid (as I was almost every time) seems inefficient.
Seller's sign-off is the trigger. It's contingent upon the lender's agreement.
In my area, the listing agent, or their designated agent if the listing agent is limited purpose) holds escrow monies. It would not be possible to make offers on multiple properties without multiple escrow deposits.
Not defending the practices of our area (Virginia DC suburbs) as it feels like a mess. But our buyer agents tend to hold the escrow money and allow multiple bids. The sellers (not the banks, the people who bought and are now short-sale approved) sign off immediately because they don't really care what the offer is; the banks take months. I didn't do this, but my agent did also say that if one came back that was not my favorite I could say I was waiting for another property and wouldn't be committed (because she still had the escrow).
Occasionally you see houses listed specifying that the seller will hold the earnest money, so apparently they are wise to this.
Anyway, it seems like the whole system would be easier if we did 1 bid at a time and banks could answer sooner (I still don't completely understand why they come up with a list price 3 months before deciding what they need to get for it). That way there would be fewer bids out there for buyers/sellers to contend with.
That said, given the risk of waiting 4 months for a bank to come back over their list price (happened to me!), I would have been pretty steamed if I'd lost 4 months of house hunting for that. With a week's wait time that would be no big deal.
Like the topic reads, can I make multiple offers if the properties I made an offer on are short sale properties?
thank you much
Be sure to include a provision in the contract that allows you to withdraw at any time up until the lender approves the sale. This way you can get out of the contract without penalty if it looks like the transaction has little chance of closing. If you don't put a provision in the contract that you can cancel your offer if you find something else you are on the hook to purchase the other shortsales you made offers on.
Making multiple offers on short sales can be very tricky since it can take months before the bank gets back to you and because of that you want an escape clause so you don't have another offer get ecepted after you have purchased something else. Hope this is helpful also when purchasing a short sale you run the risk of assuming any liabilities like back taxes, unpaid hoa's mechanic's leins ect so make sure that your contract is prepaired correctly.
On the buying side, include verbiage similar to: "seller understands buyer is making simultaneous offers and may withdraw this offer at any time prior to lender acceptance without penalty." Please have an attorney review. Include proof of funds with your offer. For escrow, make that effective within one-two business days from lender acceptance and all dates (inspections, appraisal, etc.) begin at lender acceptance.
On the selling side, an offer contingent upon lender acceptance is not fully executed until the lender approves. The offer accepted by the lender/bank becomes the (only) fully executed contract.
Laws may vary by state.
Last edited by TampaKaren; 04-16-2009 at 09:54 AM..
Like the topic reads, can I make multiple offers if the properties I made an offer on are short sale properties?
thank you much
Yes you can make multiple offers, you have to be careful and put that in the verbiage that you can cancel anytime up until a bid is successful.
Also if you do get both bids at the same time you will have to open escrow and the emd checks will be cashed and then you can cancel. That is how it works in Nevada, you should ask your realtor how it works in your state.
Also since there is so many investors out there buying 10 20 homes at a time you have to be very agressive in your offers. Good Luck
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