Bank approved short sale (contract, foreclosures, percentage, sellers)

[bonita23]

What is a bank approved short sale? Is that after the bank does an appraisal? Does that mean the bank will not accept a large percentage lower amount then the appraisal amount?

[Silverfall]

A bank approved short sale is an amount that the lender has agreed to take. So if a home is listed at $200,000 as a bank approved short sale than $200,000 has been approved. Anything less would not be approved and up to renegotiate.

There are VERY FEW bank approved short sales. You usually have to have the buyer contract and present it before they will even talk about a short sale.

[palmcoasting]

In my area it can mean a couple of things. It can mean that the sellers circumstances have been approved but not a price, or it can mean the price was approved. One of the things to watch out for is when that approval was obtained. An approval lasts until a particular date...such as 30 days from approval. After that, the figures change for the bank and it has to go through the process all over again. Some banks will leave it with the same negotiator which can speed up the process, some will make it start totally from square one.

[bentlebee]

I agree with palmcoasting. I have seen and spoken to people who claim they have a bank approved short sale while not even be behind on taxes and they try to do a short sale. I would never put in an offer since the chances are very low to be even considered. In case of a serious short sale the owner has to be in default and the price has to be reasonable. Basically the bank has not agreed on anything yet, JMO...and until you have see in writing the bank will do a short sale, it is only the word of the other person claiming that the bank will do so....who at the bank said so, and is that person still working there in a week or a month or even at the same spot in that bank...so to me it says nothing!

[palmcoasting]

I'm not sure why not being behind on property taxes would concern you....it very often doesn't come into play. A person with a mortgage has property taxes in escrow, so they shouldn't be behind. Perhaps I'm misunderstanding what you are saying.
And..it is not always required for the property to have a lis pendens filed in order to do a short sale. I have had short sales go through where the seller was NOT behind in payments. Every bank is different, every situation is different, and with all the new federal programs coming out it changes the game again. There is no set rule regarding short sales, refinancing or foreclosures.

[2bindenver]

FHA loans (sellers & property) are approved into the program.

[camrynh]

Our new house was advertised as a bank-approved short sale. We closed about 45 days after our offer was submitted to the seller -- the bank had already approved the price.