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If yours is the first offer, you will always wait a long time. So, it is wise to wait until a few offers have been placed before putting an offer in. It gives you an idea of what the bank may be looking for and your wait time is a lot less. The thing about short sales (if they are not pre-approved) is that they aren't for anyone who is in a hurry to buy. We have friends that have been waiting for the bank over six months now. It really depends on the bank and the amount of offers and the comps in the neighborhood. They usually won't move on offers that are lower than what comparable units/houses are selling for. It would be nice if they could just turn down an offer right away.
I agree, in most cases, even on a short sale, the seller should still respond within the given time limit (assuming contracts in your state have a "response time" on them). Then you can wait anywhere from 30 days to forever for the bank to respond. I've seen bank approvals come back after as long as a year. Sometimes the bank never does accept or reject.
HOWEVER, we do have some agents in our area who advise their clients that in a multiple offer situation, they shouldn't sign ANY of the offers until the bank chooses one. The banks haven't had a problem with this either. In the two deals we have had buyers in our office on that the seller wouldn't sign, both times, the bank reviewed all the offers, without seller signatures and then picked the one that netted them the best and took it from there.
Another thing to know about short sales is that if there are 2 loans (a first and a second) or more, the process will take longer and is less likely to be approved. Your agent should be able to find this out for you.
we (the sellers) accepted our short sale offer in March..buyers opened escrow in June and cancelled the short sale in September because they were "tierd of waiting and they figured that our short sale wouldn't be approved", theY cancelled before the make even made a decision....so our house has been tied up for months now without our agent accepting any offers wasting our time making our house look like it was sold when it wasn't.
Perfect example here of how long the process can take and unless you plan on committing to the sale until the bank makes their final decision you shouldn't put an offer on a short sale....it's not fair to the owners for the buyers to cancel last minute, even after waiting for months.
we (the sellers) accepted our short sale offer in March..buyers opened escrow in June and cancelled the short sale in September because they were "tierd of waiting and they figured that our short sale wouldn't be approved", theY cancelled before the make even made a decision....so our house has been tied up for months now without our agent accepting any offers wasting our time making our house look like it was sold when it wasn't.
Perfect example here of how long the process can take and unless you plan on committing to the sale until the bank makes their final decision you shouldn't put an offer on a short sale....it's not fair to the owners for the buyers to cancel last minute, even after waiting for months.
I don't blame buyers for losing patience after waiting for 6 months ... I will never get, why a short sale is called a 'short' sale anyway
and - as far as I know, your house was never tied up - the seller's agent can still accept offers. that is - from my understanding - one of the reasons, the process takes that long ... banks are waiting for better offers.
but - please correct me, if I am wrong.
I found this thread on my search for 'short sales'. we put an offer down on a short sale today, but after reading several threads, I don't see any chance our offer will go through.
our agent hopes to hear something back by the end of year ... that's very positive, I guess.
I've read the following today "the problem has been, many banks have failed to behave themselves in processing requests to sell houses as short sales. Lenders had set up their own voluntary guidelines that people would have answers in 45 days" ......"Real estate agents can tell you that hadn’t been happening. But now, new federal rules give lenders ten days to respond to purchase offers. Ten days in the banking world is 14 because Saturdays and Sundays don’t count. Not all loans are covered by the ten-day rule – loans guaranteed by Fannie Mae and Freddie Mac will fall under a different set of guidelines. But for the rest, getting an answer in two weeks is better than 45 days, if ever"
this blog is from 1/2010, but I could not find any more information regarding this new federal 10-day- rule ....
to me the whole procedure does not make sense at all. there are only a few buyers who can afford to wait 6-18 months for short sale (especially since there are sometimes better deals on the regular house market). this system just sucks
the house we were putting an offer on was listed for 419 K, we offered 350 K. I don't think our offer went over the top, but I am pretty sure the banks decision will be beyond our dead line.
yes, our house was tied up when buyers opened escrow the agent did not accept any offers and did not continue to market the property... Just be careful and do lots of research, know what you are getting into and yes it does suck, there is a lot that makes no sense at all (from my experience anyway)!! Good luck to you~~
that stinks.
Did your agent tell you all the details upfront or with this kind of a surprise ?
the whole short sale thing is not that new anymore, but there are still many realtors out there, who simply don't know enough to guide sellers (and buyers) through this tricky process.
'our' seller already asked, if they could stay in their house until 2/2011 ... that would not be a problem at all (still feel kind of guilty for the attempt of getting a great house cheap, because another family is in trouble ) - but I have NO hope at all, everything could be settled by the beginning of next year. from what I've read it will take many more months ... and we can't wait for (just the decision) more than 3 months.
so are you still offering your home as a short sale, so it's back on the market and you had to start all over ?
what an exhausting time must that be ....
I'll tell you about my situation that hopefully is coming to an end.
We put a short sale offer in July. The seller accepted right away. Escrow was opened and we put a small deposit down. Opening escrow before the bank accepts your offer is generally a no-no. But in our instance we were committing our offer to the seller for a certain period of time. While I'm looking out for myself as a buyer, I have to understand that from a seller's standpoint me being able to walk away from the deal early when I know it should take upwards of 90 days isn't fair to them. So we decided to do it. The listing agent is a short sale specialist - it is the only thing his company does so we were confident. Another factor is that when we toured the home, the sellers were already packed up. It looked like to us that they were not attempting a loan mod or were stalling and that was also a key factor.
queenofbavaria, our seller also asked if they could stay in the house until the end of November because they had no money and no where to go. We were concerned with it but figured we'd cross that bridge when and if we got there. The sellers were nice people and we're in position where it would be a slight inconvenience but not a huge problem so again we were okay with it. This is a moot point now though, because we're not in escrow and it's already November.
Anyway 2 months into our short sale, the bank tells the seller they qualify for HAFA. So new paperwork has to be filed and the deal restructured. About 4 weeks after that, the bank says they do not qualify for HAFA. So again, deal is restructured and submitted again. There's 2 loans both with the same bank, but one loan is being entirely paid off so only the 2nd is short. This puts us at about 120 days into the deal and this is where I'm starting to feel defeated.
Then just yesterday the bank countered our offer and we submitted paperwork today that agreed with their price. Hopefully (fingers crossed) we get an approval by the end of this week and close escrow at the end of the year.
I do want to mention that I kept my eye on the market while all of this has been going down, but hadn't found anything else I was interested in.
My husband and I are currently six months in on an FHA short-sale.
We made our offer made 5/21, Seller accepted 6/2, Bank accepted offer w/escrow for consideration 6/27, 7/6 foundout it was FHA shortsale and seller had not yet applied to sell home as shortsale with FHA, Had to wait on homeowner, FHA and sellers bank to get all paperwork BPO's in place to even concider our offer, 8/30 they came back with counter, we declined, 9/27 they accepted original offer, sched to close 10/20... we paid for FHA appraisal & home inspections... 7 days before closing the appraisal came back and the house didnt' appraise... Unable to get loan for home more than it appraised... Closing cancelled, offer back in banks hands to concider selling at appraised value 10/14, 11/04 selling bank ordered another BPO... 11/15 new BPO came back confirming appraisal... Waiting on FHA and sellers bank to re-evaluate.
At this point if it doesn't get approved we'll lose the $800 out of pocket for the FHA home appraisal and the home inspection. Plus, If we walk away before the bank officially declines our offer we will also lose our earnest money. So, we are stuck... six months wasted, still no home, still no answer.
Honestly, I don't think a house should be able to be listed on the market as a shortsale without having it pre-approved first. It's nearly a 90 day process just to get the approval, nevermind actually concider the offers. I will NEVEREVER make another offer on a shortsale... Just wait for it to foreclose and then buy it after all the BS has already been taken care of.
My husband and I are currently six months in on an FHA short-sale.
We made our offer made 5/21, Seller accepted 6/2, Bank accepted offer w/escrow for consideration 6/27, 7/6 foundout it was FHA shortsale and seller had not yet applied to sell home as shortsale with FHA, Had to wait on homeowner, FHA and sellers bank to get all paperwork BPO's in place to even concider our offer, 8/30 they came back with counter, we declined, 9/27 they accepted original offer, sched to close 10/20... we paid for FHA appraisal & home inspections... 7 days before closing the appraisal came back and the house didnt' appraise... Unable to get loan for home more than it appraised... Closing cancelled, offer back in banks hands to concider selling at appraised value 10/14, 11/04 selling bank ordered another BPO... 11/15 new BPO came back confirming appraisal... Waiting on FHA and sellers bank to re-evaluate.
At this point if it doesn't get approved we'll lose the $800 out of pocket for the FHA home appraisal and the home inspection. Plus, If we walk away before the bank officially declines our offer we will also lose our earnest money. So, we are stuck... six months wasted, still no home, still no answer.
Honestly, I don't think a house should be able to be listed on the market as a shortsale without having it pre-approved first. It's nearly a 90 day process just to get the approval, nevermind actually concider the offers. I will NEVEREVER make another offer on a shortsale... Just wait for it to foreclose and then buy it after all the BS has already been taken care of.
This is why you should not put earnest money until after bank approval. If you want to put up earnest money before approval then keep the amount to less than $100.
We made offers on multiple short sales - eight of them actually. All within a two week period. We made offers on 2 REOs. We received an immediate 'no' on one REO and 'yes' on the other and closed in less than 4 weeks. After a year of living in our new place, we finally heard from one of the short sale banks. Obviously, we were no longer interested.
However, friends of ours got a short sale handled in about 5 weeks.
So . . . you never know. Personally, I wouldn't even look a a short sale.
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) - but I have NO hope at all, everything could be settled by the beginning of next year. from what I've read it will take many more months ... and we can't wait for (just the decision) more than 3 months.
