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Old 06-30-2011, 07:43 PM
 
264 posts, read 561,250 times
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As the title says, I have a real estate buyer's agent, but I just found out about a FSBO/pre-short sale of a neighbor's house that I'm interested in.

I have nothing against my agent, but I don't know how this would work with the bank and any offer I present. Am I obligated to include my agent in the process? Would this potentially hurt my offer and perhaps require me to up my price to compensate for her commission?

Thanks.
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Old 06-30-2011, 09:29 PM
 
Location: Long Island
9,302 posts, read 19,593,238 times
Reputation: 5041
Quote:
Originally Posted by ruhkus View Post
As the title says, I have a real estate buyer's agent, but I just found out about a FSBO/pre-short sale of a neighbor's house that I'm interested in.

I have nothing against my agent, but I don't know how this would work with the bank and any offer I present. Am I obligated to include my agent in the process? Would this potentially hurt my offer and perhaps require me to up my price to compensate for her commission?

Thanks.

There are several issues here, and I won't cover them all, just some.

First, lenders won't accept a short sale unless the property has been listed on MLS. Most likely reason: adequate exposure to maximize amount they can recoup.

Second, if you have a Buyer Agent, you most likely signed a contract. If you did, the contract (if it's a standard Buyer Agency Contract) probably states that you will owe her a commission even if you buy on your own during the contracted period. Please read your contract carefully.
BTW, in a short sale transaction, the commission is generally paid from the sales proceeds.

Next, regarding your agent, is she experienced/knowledgeable with regard to short sales? Can she recommend a good Real Estate attorney who has ample experience with short sales?

That's it for now ;-)
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Old 07-01-2011, 08:36 AM
 
264 posts, read 561,250 times
Reputation: 159
Thanks for the response.

With regard to the short sale, it is my understanding that the house is going to be FSBO first. If the owner cannot sell it at a price the bank will accept, then it will go into a short sale (and I assume go on MLS). My hope here is that the bank may be more willing to accept a lower offer when it's FSBO, since they would save money and time versus if it went on MLS.

You're right, I will need to, ahem, find, then review the contract. My key concern though is that if the bank needs to pay a buyer's agent commission, then they may think it's best to just go ahead with a full short sale/MLS listing. I don't recall an end date on the contract though....

As for her experience with short sales, I'm not too sure, since it's something we weren't focusing on.
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Old 07-01-2011, 01:04 PM
 
Location: Long Island
9,302 posts, read 19,593,238 times
Reputation: 5041
Quote:
Originally Posted by ruhkus View Post
Thanks for the response.

With regard to the short sale, it is my understanding that the house is going to be FSBO first. If the owner cannot sell it at a price the bank will accept, then it will go into a short sale (and I assume go on MLS). My hope here is that the bank may be more willing to accept a lower offer when it's FSBO, since they would save money and time versus if it went on MLS.
Sounds as though the sellers are trying to sell it on their own and see if they can net enough to pay the bank whatever they owe. I don't know the price/location of the property to comment on whether they have realistic expectations or not.

With regard to a lower offer vs. listing on MLS, banks have certain guidelines and this is just another property to them, so I seriously doubt that they will work with your train of thought. JMHO based on past experience though...

Quote:
Originally Posted by ruhkus View Post
You're right, I will need to, ahem, find, then review the contract. My key concern though is that if the bank needs to pay a buyer's agent commission, then they may think it's best to just go ahead with a full short sale/MLS listing. I don't recall an end date on the contract though....
Sounds like a good plan This could determine your next step.

Quote:
Originally Posted by ruhkus View Post
As for her experience with short sales, I'm not too sure, since it's something we weren't focusing on.
If it turns into a short sale, I suggest you work with someone knowledgeable - hopefully she is.
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