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so my realtor told me today that the biggest hurdle in the particular house im looking to buy is that it is underpriced, and that even if they accept my offer and go into contract, eventually the bank that owns the home will get an appraisal and when they do, it will be for alot more than the accepted offer, and they are going to ask for more money, back out of the deal and relist it for a higher price.
Is she right? maybe she just means back out of the offer agreement, which i understand is not binding, but the contract?? can they really back out of the contract after both parties sign?
You need to understand if you're talking about a foreclosure or a short sale. With a foreclosure, they've already gotten an appraisal and have run the numbers. They know the value.
With a short sale, the seller still owns the house. The seller can accept whatever offer they want and make it a contract, but it doesn't mean the bank will approve the sale.
You have more questions to ask your agent to know which situation you're in.
You need to understand if you're talking about a foreclosure or a short sale. With a foreclosure, they've already gotten an appraisal and have run the numbers. They know the value.
With a short sale, the seller still owns the house. The seller can accept whatever offer they want and make it a contract, but it doesn't mean the bank will approve the sale.
You have more questions to ask your agent to know which situation you're in.
its a foreclosure, the old owners are out. the person that showed me the house said its a bank owned house.
she said sold as regular house except its "as is" and its winterized.
the bank paid a fortune for the house in court or whatever b/c the old owner must have had so many years of unpaid taxes and mortgages, etc.
its a foreclosure, the old owners are out. the person that showed me the house said its a bank owned house.
she said sold as regular house except its "as is" and its winterized.
the bank paid a fortune for the house in court or whatever b/c the old owner must have had so many years of unpaid taxes and mortgages, etc.
Write your offer.
When you get a contract, you will have set a contract price. The bank won't be able to just arbitrarily raise the contract price, unless you agree to it, either in an addendum, or a proprietary form.
The bank has already done their valuation, and they know what they want from the property.
YOUR lender (a bank?) will likely require an appraisal, but that is between you and your lender and is confidential information.
Write your offer.
When you get a contract, you will have set a contract price. The bank won't be able to just arbitrarily raise the contract price, unless you agree to it, either in an addendum, or a proprietary form.
The bank has already done their valuation, and they know what they want from the property.
YOUR lender (a bank?) will likely require an appraisal, but that is between you and your lender and is confidential information.
Write your offer.
okay thats what i had thought, planning on discussing again with my realtor tomorrow. i must have mis-understood her.
It also may be underpriced because the bank knows of some issues with the house as they generally put the price at the value minus repair costs.
I am in escrow now for a house at about $45k that will have a value of about $100k after it is fixed up. But the bank does not do any repairs and it needs lots.
Echoing what was said above. If its truly a bank owned property, the bank has already had a broker price opinion performed (sometimes several by different agents), so they know what the property is worth. It's short sales where agents/sellers can come up with their own list price, but the bank still has to approve it and if it comes back too high, they could raise the list price.
yea it was clarified to me that, what she means is that they may do another appraisal before they sign the contracts, and if thats the case, they will likely back out of the deal and ask for more money, change the list price etc.
but i dont think they would do this, b/c they just listed the house a month ago.
I've done plenty of foreclosures and never had a single one ask for more money after the contract was accepted, doesn't even make sense to me. Now they could ask for more BEFORE accepting the contract but if its too much, you can say no.
If its just listed and really cheap, the price can skyrocket due to competing offers but they don't normally change the listing price or anything, they just take the best offer.
yea it was clarified to me that, what she means is that they may do another appraisal before they sign the contracts, and if thats the case, they will likely back out of the deal and ask for more money, change the list price etc.
but i dont think they would do this, b/c they just listed the house a month ago.
If it's been listed for a month, it's probably not that great of a deal otherwise someone would have jumped on it already. Tread carefully.
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