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We are about to bid on yet another short sale (our 5th) tomorrow. As of today, there was one bid on the home (but it was a ridiculous offer we were told). The bank stated to the listing agent that if they had another offer on the home, they would have a BPO done. (since the home has been in short sale status for 4 months)
So if our offer is lower then the BPO do the banks usually accept it or come back and ask for a higher amount for the home?
Do they usually do BPO's with only one offer on a short sale? They did one already when the first ridiculous offer was put in.
Could someone explain what is involved with a BPO. I don't understand the process.
BPO stands for Broker Price Opinion. It is basically a market analysis, and the brokers opinion as to what the house coulda/woulda/shoulda sold for. in this market a moving target. Also, as stated in another thread in this market I can make a case for a plus/minus $50k....
Anyway, no one can tell whether the bank will just accept or try to negotiate. You can only make your best offer and see what happens.
Anyway, no one can tell whether the bank will just accept or try to negotiate. You can only make your best offer and see what happens.
shelly
Anyway, no one can tell whether the bank will just accept or try to negotiate. You can only make your best offer and see what happens.
Or whether they'll even agree to a short sale at all. Many lenders simply proceed with the foreclosure. Statistics range from 5% to 30% as to the number of short sale contracts that actually close escrow. Of course, each area is different, but generally speaking it is very difficult to get the banks to agree to a short sale. Sometimes the buyer's offer is too low. Other times the seller doesn't supply all the necessary paperwork to prove hardship. And sometimes the bank just feels like they'll recoup more of their money by going ahead with the foreclosure. The closer the property is to auction, the less likely that the lender will agree to a short sale.
Anyway, no one can tell whether the bank will just accept or try to negotiate. You can only make your best offer and see what happens.
Or whether they'll even agree to a short sale at all. Many lenders simply proceed with the foreclosure. Statistics range from 5% to 30% as to the number of short sale contracts that actually close escrow. Of course, each area is different, but generally speaking it is very difficult to get the banks to agree to a short sale. Sometimes the buyer's offer is too low. Other times the seller doesn't supply all the necessary paperwork to prove hardship. And sometimes the bank just feels like they'll recoup more of their money by going ahead with the foreclosure. The closer the property is to auction, the less likely that the lender will agree to a short sale.
How do they recoup more money with a forclosure? Can they sell it for a higher amount then. I am finding that short sales might not be the way to go. Maybe I will just have to wait until I find a home that isn't. We will see what happens on this one we are making an offer on tomorrow.
Make a Good Offer chick. Folks think because it is a short sale they don't have to take into consideration the comps, the market, and other factors. Find out everything you can and then make a good strong offer. sometimes that means offering more than what it is listed for......
How do they recoup more money with a forclosure? Can they sell it for a higher amount then. I am finding that short sales might not be the way to go. Maybe I will just have to wait until I find a home that isn't. We will see what happens on this one we are making an offer on tomorrow.
I know, it doesn't seem to make much sense, but I had a loan officer tell me that the more legal fees that have been incurred during the default to foreclosure, the more likely the lender is to feel that they'll recoup more by proceeding with the foreclosure and then selling the home as a bank owned property. I'm guessing it may be more of an accounting/bad debt write-off type of thing than actual money made or lost.
Here in my area, the real bargains are on the bank owned properties, and those close within 30-45 days. The list prices on these short sales are often "teaser" prices, just to garner activity and multiple bids. They are not necessarily indicative of how much the lender is willing to accept. As Shelly mentioned, a lender is not going to accept a bid that's much below market value, regardless of what the home is listed for in the MLS. If it's priced $50k-$100k below market value and a buyer makes a bid at $25k over asking price, it's still very unlikely it would be accepted by the lender.
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