real estate jungle out there, stuff I didn't understand and now do (Phoenix: bank owned, short sales)

[annie7]

Just got back from being in Phoenix for 2 weeks. Long story. Some of you maybe know that I am hoping to move to your beautiful, energetic city. Our house in KC has a contract on it and I wanted to put in an offer contingent (because of lender) on our closing date. Even though we will have more than a 50 % down payment once we have the check in hand, our realtor told us no bank would even consider looking at our offer. It has greatly discouraged me because once we do get the money, then we'll have to obviously find a place to stay, put our things in storage and hope for a quick closing date. I've heard that dealing with banks is horrendous.

I've sort of let it go and won't do much until we have the check in hand. it's just so damn discouraging. I didn't understand the whole process and wanted to put an offer in on a house. Anyone else out there that has been in the same position and can encourage? And also, I want a 299k home for 220....there ya have it. Thanks for reading so far....let me know your experiences.

[rjrcm]

Your Realtor is correct. Banks will not accept contingent offers. And in this market many regular sellers will be reluctant, although having a contract on yours may get some to accept. I'd also like a $299k home for $220k, but finding one will be difficult. I assume you are talking about finding a home with a $299k market value that someone will discount by 26%, and not just one overpriced?

[AZJoeD]

Originally Posted by annie7

And also, I want a 299k home for 220....there ya have it.

Why would anyone sell a $299K home for $220K?

[imcurious]

This is the reality today. Make it as easy on yourself as possible. Rent a place on a month-to-month basis and put most of your stuff in boxes in the garage and just live as simply as possible. Move to a really nice place in the interim and give yourself a little vacation (a place with a pool or whatever). Make it fun. It does not have to be horrible.

[khuntrevor]

I have a place that would be good for while you are house hunting. It is a slimy mess dealing with the banks. It will take about 20 tries to get one. Especially if you are bottom feeding, and apparently you want a good deal (nothing wrong with that). My place is for one or 2, PM me, if interested.

[annie7]

The comment I made about a home for 299k is just dreamin'. Especially with this particular home. At 299k, i think it's still a steal, unfortunately, I can't afford it...or don't want to be house poor. I will come back with cash in hand and hopefully I'll find something that won't take too long. Geeez...It's difficult and certainly not like it used to be. Fortunately, we did okay on our home in the midwest...I wouldn't sell my home if I were going to take an incredible loss. The home we want to buy is where we'll stay. It's not for resale etc...it's actually for our own pleasure of living in a home that is OURS. Anyway, I am greatly discouraged only because even when one has the cash it looks like it's still a hit or miss thing. Thanks for the replies.(ps...what is 'bottom feeding'?)

[MN-Born-n-Raised]

Originally Posted by annie7

(ps...what is 'bottom feeding'?)

See definition 2 Urban Dictionary: bottom feeder

The term came from fish that hang out near on the bottom of the ocean /lake/ aquarium. They feed off of "food" that drops to that bottom. Sometimes that food could be... well... po_p. Therefore they are not exactly worried about their image so long as they eat.

Bottom feeders are a pain in the butt to deal with (from a Salesperson's perspective). They want a lot of mind share yet are not willing to pay for it. And as a side note, they are the highest maintenance people.

It could be that person at your garage sale that offers you 1/2 price for the item that you priced to move and was obviously a deal to start with.

[annie7]

Bottom feeding huh? Hmmmmmmmmm??? Am I??? Wow...probably? I have cleaned my share of p___ before to get the deal. However, it turned out to be not so great of a deal. Something to ponder for sure.

[khuntrevor]

But a bottom feeder is still a lot higher class than a realtor or a corporation that lent someone 200K, that only makes 16K. I would say my realtor put in about 25 hours of work for me--and helped me get an SFR in midtown for 15 cents on the Dollar. Using Docusign makes a huge diffeence. Completely paperless transaction, except for the Deed they will send me a copy of.

[Captain Bill]

Your Realtor is telling you like it is. As others have said, banks will not accept a contingency on selling your home, even if you have a contract. Neither will many regular sale home owners.

If you need to get into a home fairly fast, then you will want to bypass short sales unless you find one where the bank has approved a price. That happens when they're negotiating with a buyer, and at the last minute, either just before, or after, the bank gives their final price, the buyer walks.

Those types will close fairly fast. But that's the exception. You can expect to wait up to 3-4 months for the loss mitigator to come back with their counter to your offer, and it may be higher than you want to pay, and the deal falls through. Sort of disheartening after waiting for several months.

Also, the listed price for a short sale may be a lot less than market value (and less than what the bank will accept) so the listing agent can get an offer to submit and get the short sale process started.

Bank owned (REO) properties will have a response within a few (1-5) days. The listed price is set by the bank. Many times these prices are higher than the market value of the house.

Cash, in many cases, will get you a lower price because the seller doesn't have to worry about financing contingencies. Today, financing is difficult and transactions fall through because of the inability to get financing.