patrick.net

Not deal with situations like that.

Give time sensitive offers only. It is foolish to put an offer on any property and be taken out of the Market for three months while the seller drags their feet. Better deals could be coming by, that you can not offer on, because you are tied up with a contract, that is neither approved nor declined.

Learn when you're being gamed, and your chances of being a sucker greatly diminishes.

I think the lenders are Chase and Wells. I hope my cushion is thick enough to weather the drop. I think the owner is in strategic default.

Hasn't your offer technically expired already?

When we offered on a short sale about 1 yr ago, the offer expired after 3 days, but when we were contacted 2 months later saying we were the highest offer, we had the option to basically resubmit the offer knowing it would be accepted or just say no thanks. We had moved on to another house by then, so we just said no thanks.

Any reason you come to the conclusion the short sale will not close? Are Chase and Wells hard to deal with?

The wife and I have given up on short sales after trying 3 times. The first dragged on for 7 months before we even got a response from the bank. The last offer fell through, the bank seemed to be on board but then just foreclosed on the seller. Good luck, you'll need it if you expect to close in a reasonable time frame.

kimtitu says

Any reason you come to the conclusion the short sale will not close? Are Chase and Wells hard to deal with?

Simple, because there are two lenders involved. The first mortgage wants to give nothing to the second mortgage, since they can just wipe them out in a foreclosure at the courthouse steps. Thus, the second mortgage has nothing to gain from the short sale and will not approve it. Gridlock.

You're dealing with an incompetent agent that's not well versed in short sales, otherwise they wouldn't be wasting their time on a short sale with more than one lender involved.

Find a new agent that has real experience with short sales.

Kimtitu, I am in your situation as well. Does the escrow company have any of your money yet? Once they accept it, you don't have to take the offer if you don't like it. But Chase is going to counter with a full 100% market price anyways. Makes you think why you even waited all those months in the first place. I think it's normal to feel that way after submitting a short sale. You feel like prices are creeping down. But step back and take a look at the big picture. My short sale was offered at the end of March when I would have expected a double tax credit (California and Obama). I won't be getting anymore of those it seems, and my offer price has increased since then.

Mark_LA says

You’re dealing with an incompetent agent that’s not well versed in short sales, otherwise they wouldn’t be wasting their time on a short sale with more than one lender involved.

Turns out this is exactly what happened to us. We didn't know there was a second loan. Listing agent was an idiot. We just happen to drive by the house and saw the trustee sale posted on the house and it was from the second lender. I called our agent and made a lot of noise about it but the listing agent just sat on her fat ass and did nothing. They told us we'd have an answer by a certain date, but no answer came. The next week it sold at auction. And that was all she wrote.

We had an offer in on a short sale and after four months the bank rejected it. Deadlines on offers mean nothing to them. While you have no control over what they do, you can protect your own interests by making sure when putting an offer in on a short sale that:

1) no earnest money gets deposited until the bank (not just the seller) approves (so you don’t tie up your funds indefinitely)

2) insert a clause stating you can cancel the contract at any time prior to bank (not seller’s) acceptance of the offer. This lets you keep looking at other houses, if you so choose, in the months it takes for the bank to make its decision.

3) Attorney review starts upon the seller’s acceptance, not the bank acceptance, so see a real estate attorney right away. Not sure if its possible, but you may be able to change the contract to read that attorney review starts upon bank’s (third party) acceptance (so you don’t rack up a legal bill until you’ve actually reached an agreement).

4) Same with home inspection, etc. Change the contract to read that the home inspection period starts AFTER the bank (third party) approves, otherwise you will have to pay the inspector for a house you may not get to buy.

5) If you need a mortgage, you may be required to get approval (not just pre-qualification) within X days of seller’s approval, even though the bank has not approved. Not a big deal, but researching lenders, and gathering and copying that paperwork can be somewhat time consuming.

An good agent - and one experienced in short sales - should point these kinds of things out to you when the offer is written up.

I hope this helps!

I wonder what happens if your offer gets accepted and you back out? I understand your earnest money can go to them. But what if they have no earnest money? Are they seriously going to come after you for some cash? I doubt it.

My short sale seller has offered me the keys to move in. She said if you get it, great. If it gets foreclosed, you have to move. But it's the sellers holding it up for now because they're trying to get a deficiency judgment clause removed.

We had an offer in on a short sale and after four months the bank rejected it. Deadlines on offers mean nothing to them. Just make sure when putting an offer in on a short sale that:

1) no earnest money gets deposited until the bank (not just the seller) approves (so you don't tie up your funds indefinitely)

2) insert a clause stating you can cancel the contract at any time prior to bank (not seller's) acceptance of the offer. This lets you keep looking at other houses, if you so choose, in the months it takes for the bank to make its decision.

3) Attorney review starts upon the seller's acceptance, not the bank acceptance, so see a real estate attorney right away. Not sure if its possible, but you may be able to change the contract to read that attorney review starts upon bank's (third party) acceptance (so you don't rack up a legal bill until you've actually reached an agreement).

4) Same with home inspection, etc. Change the contract to read that the home inspection period starts AFTER the bank (third party) approves, otherwise you will have to pay the inspector for a house you may not get to buy.

5) If you need a mortgage, you may be required to get approval (not just pre-qualification) within X days of seller's approval, even though the bank has not approved. Not a big deal, but researching lenders, and gathering and copying that paperwork can be somewhat time consuming.

An good agent - and one experienced in short sales - should point these kinds of things out to you when the offer is written up.

I hope this helps!

Thanks for all good information. Yes. I do write a check for earnest money it is not cleared yet. It can only be cleared when the bank accepted the offer.

unfortunately, you gotta use a realwhore for short sales. that's the system. even if you use your own, it'll drag on for some time. check your contract - there's usually an acceptance time frame and it's probably long past now.

If they accept your offer in the future and you're not happy with the price at that time, don't pursue the place.