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Old 06-08-2011, 02:04 PM
 
Location: Salem, OR
15,539 posts, read 40,313,582 times
Reputation: 17422

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Quote:
Originally Posted by mgt04 View Post
This is completely wrong. Once you make an offer on a short sale you sign a contract signing up to your offer in which it gets sent to your attorney if you have one first to check everything over. Then it goes to the seller in which they have 3 days (called attorney review) for them to accept and go over and sign the contract. Once you're out of attorney review the listing is removed from the MLS database and the seller cannot entertain anymore offers. The sellers bank who does the approval looks at the short sale package provided to them which has the ONE offer for them to agree on the price which is the part that takes forever.

A cash buyer or any buyer cannot just come in at the "last minute". First off the house listing shouldn't be listed anymore which means its not being advertised. Secondly the seller has to go through the whole bank approval process again with a new buyer should the original buyer cancel.

The only time any type of bidding war would exist is is before attorney review is completed the seller can entertain all offers which is well before all this bank approval process.
This is a national forum and this advice would be completely inaccurate for many of the west coast states that don't use attorneys in real estate transactions.

In Oregon, we keep our short sales on active status until we have short sale approval from the lender. Then we go to under contract status.

Also some banks want to see all offers, not just the one. It just really depends on the bank. I do agree that if there are going to be multiple offers it tends to happen when it is active. Most buyers don't try and bump other offers that have short sale approval out of the way.
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Old 06-08-2011, 02:05 PM
 
Location: Tempe, Arizona
4,511 posts, read 13,555,371 times
Reputation: 2201
Quote:
Originally Posted by mgt04 View Post
This is completely wrong. Once you make an offer on a short sale you sign a contract signing up to your offer in which it gets sent to your attorney if you have one first to check everything over. Then it goes to the seller in which they have 3 days (called attorney review) ...
Depends on where the OP is located. Many states, particularly in the West, do not involve attorneys or have attorney review. The way short sales are handled also varies by location. Here, with our standard short sale addendum, it would be possible for the bank to look at multiple offers even if they have a signed contract.
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Old 06-08-2011, 06:25 PM
 
Location: Martinsville, NJ
6,175 posts, read 12,916,158 times
Reputation: 4020
Quote:
Originally Posted by mgt04 View Post
This is completely wrong. Once you make an offer on a short sale you sign a contract signing up to your offer in which it gets sent to your attorney if you have one first to check everything over. Then it goes to the seller in which they have 3 days (called attorney review) for them to accept and go over and sign the contract. Once you're out of attorney review the listing is removed from the MLS database and the seller cannot entertain anymore offers. The sellers bank who does the approval looks at the short sale package provided to them which has the ONE offer for them to agree on the price which is the part that takes forever.

A cash buyer or any buyer cannot just come in at the "last minute". First off the house listing shouldn't be listed anymore which means its not being advertised. Secondly the seller has to go through the whole bank approval process again with a new buyer should the original buyer cancel.

The only time any type of bidding war would exist is is before attorney review is completed the seller can entertain all offers which is well before all this bank approval process.
This is the danger of even a well intentioned internet forum. People come here and say things with an air of authority, which people them believe, and it turns out they are entirely wrong.

Who told you a seller cannot entertain additional offers after accpeting one? I doubt that it's true ANYWHERE, and I KNOW it's not true in NJ. A seller may entertain offeres up to the moment they transfer ownership to the buyer. There may be repurcussions for breaking the contract they had with the first buyer, but that's a different matter. If an offer is given to the sellers agent, the agent MUST make it known to his seller client.
Further, with respect to the seller needing to go through the entire process again if they are dealing with a new buyer; so what? The difficult part of the process is in evaluating the property and the seller, so the lender can determine whether they are willing to accept a short payment from the seller, and how much of a short they will accept. Having a new buyer come along and offer up an additional few dollars does not much complicate that process for the bank, as most of the heavy lifting on that research has already been done and will remain the same regardless of the buyer.
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Old 06-09-2011, 08:28 PM
 
Location: Southern California
3,113 posts, read 8,364,499 times
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We got lured in by the idea of a super low price for a short sale house - but after bidding on a few it didn't take long to figure out that they ALL ended up selling for exactly what they were worth, based on our local market. So then on the next house, we ignored the initial asking price, and bid what it was really worth - and we got that house! It was a little more complicated than a traditional sale, but we ended up with a house we love, so it was definitely worth it!
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Old 06-10-2011, 08:49 AM
 
2,059 posts, read 5,738,777 times
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The list price is no guarantee of what the bank will accept from the seller, you should never assume the list price is what you can expect to pay for a short sale.

We've seen plenty of short sales go under contract only to come back on the market at a higher list price. You can submit all the offers you want but the selling bank is the one who decides.
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Old 06-12-2011, 12:02 PM
 
Location: Dana Point
143 posts, read 430,735 times
Reputation: 157
Quote:
Originally Posted by rfr69 View Post
This generally doesn't happen with regular sales, if you dont like it buy a regular sale. Short sales are a bargain for a reason.
No kidding. I think of it as "emotional sweat equity" and it's usually a good deal for those who can handle it.
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Old 06-14-2011, 05:39 AM
 
Location: MID ATLANTIC
8,670 posts, read 22,856,196 times
Reputation: 10490
Around here, you'd miss the boat if you were waiting for an attorney to review the contract.

Unfortunately, the OP is learning by fire about highest and best offers in a free market. Most buyers have to learn this for themselves, as they rarely take their Realtor's advice. The ones that take their Realtor's advice their first time out and win the contract, almost always think they offered way too much and were taken for a ride.

<sigh>
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Old 06-14-2011, 01:20 PM
 
593 posts, read 1,313,418 times
Reputation: 192
Quote:
Originally Posted by tls759 View Post
Thanks. That's why we've stopped looking until all the short sales have cleared out of our area. For every 15 short sales there is 1 bank owned and one regular owner selling. I refuse to play the game and really think somebody needs to regulate this, it is absolutely unethical.
regulate??
boy,,,,
There is nothing unethical about this...
Let say I am selling a car, for 5k, and I have to buyers at the same time..
what should I do???
I say, well the person that offers more takes the car.
Why this is unethical?
You made an offer, and they decline, if that would be unethical then everybody would be unethical. You never said no on an offer?
Short sale or not, it doesnt matter...
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Old 06-15-2011, 10:47 AM
 
Location: Barrington
63,919 posts, read 46,615,875 times
Reputation: 20674
Quote:
Originally Posted by rjrcm View Post
Depends on where the OP is located. Many states, particularly in the West, do not involve attorneys or have attorney review. The way short sales are handled also varies by location. Here, with our standard short sale addendum, it would be possible for the bank to look at multiple offers even if they have a signed contract.
Attorney review is customary in my area. It typically occurs after the bank ( when/if) accepts the offer, when it's a short sale.

At the time of the initial offer, the potential buyer does not even know if the seller will qualify for a short sale. Makes no sense to spend $ on an attorney with no certainty that the offer will be accepted, yet alone close.
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