Replies to This Discussion

Permalink Reply by Thom Colby CA Brkr 888-391-5245 on June 18, 2012 at 8:29am

Nick - in some parts of the country where inventory is very low, it's not unusual for multiple offers and for properties to go under contrct quickly.  I had a short sale condo listing, put it on the MLS at Fair Market Value and got 6 offers in 2 days.  We Countered everyone and signed an offer within a week.

Permalink Reply by Nick Smith on June 18, 2012 at 8:33am

Thanks for the fast reply, so once under contract pretty much it is gone unless the bank (BOA) chooses not to accept or the buyer's financing falls through.  Just seemed odd that a property would go under contract so fast, seems like banks would want to accept higher offers.

Permalink Reply by Kelly W. Maynard on June 18, 2012 at 8:37am

That would be a good question for your Realtor, as your Buyer's representative, to ask the listing agent.  Sometimes the Seller may request their listing agent to not accept any more back up offers. The Seller is not forced to accept back-up offers. I have had short sales with B of A where I have had an approval right away, and I will change the status on the listing to "Pending" once it enters into escrow. 

The best suggestion I can give you is to use a Realtor as your representative.  They can tell you everything you need to know about what to expect when purchasing a short sale, and they can talk to the listing agent and get all the information needed.  Right now you have no facts and can only assume something shifty is going on when it probably is not.

Permalink Reply by Nick Smith on June 18, 2012 at 8:44am

Yeah we did have a Realtor contact the listing agent so we can swoop right in if it goes back on market.  I just was surprised banks don't have a standard offer period set for homes or something.  Seems like they are leaving money on the table in the bidding process.  I can understand from the selling Realtor's perspective, they want to get the house sold as quick as possible.  From the bank's perspective to not accept high $ offers a week or two after a property is listed on MLS just seemed odd to me.

It doesn't sound like this isn't all that unusual though.  I just wanted to make sure there was no way to get an offer in at this point.

Permalink Reply by Jeff Payne on June 18, 2012 at 9:51am

Nick, you are making an assumption that the offer that was submitted was not high enough and that more time on the market would bring a higher offer.....    The bank does not own the property, the seller does and it is in the sellers best interest to get the highest and best offer that they can.  A higher offer is not always the best offer.   How long would you think it should be on the market?  What happens if it is on the market for 2 months in a declining market?  Think that helps the bank?

Permalink Reply by Nick Smith on June 18, 2012 at 9:58am

Good points. I am just an average joe who just is dipping into buying a new home so just not aware of all the in's and out's.  I was just surprised there isn't a little more structure around the process, but in the grand scheme of things that is why Realtor's get paid to understand all of the in's and out's and help buyers/sellers make good decisions.

Permalink Reply by Jimmy Williams on June 18, 2012 at 9:23am

Nick,

I will add a couple of items to the comments already made.

1) The bank does not have a say in which contract that a home seller accepts. The bank does not own the house. The bank only is involved in accepting or rejecting the offer. This also applies as to how long the house is on the market before an offer is accepted.

2) The bank will protect their interest by having an opinion of value done on the home. In most cases if that value comes in higher than the offer accepted by the homeowner, the bank will ask the buyer to pay more for the home.

Permalink Reply by Nick Smith on June 18, 2012 at 9:48am

Thanks for all helpful replies, appreciate them.  The basic system makes more sense now. 

Just from the outsiders point of view it seems to be a loophole in the system in that the most money possible isn't being made up for the original owner's not being able to pay the original mortgage.  The owner doesn't have that much drive/incentive to make sure they get as much as possible for the home and would seem to open up the door for all kinds of political and questionable arrangements and deals.

Permalink Reply by Thom Colby CA Brkr 888-391-5245 on June 18, 2012 at 9:58am

To add to what others have said;

1) The current owner is THE Owner - not the Lender or the Investor.

2) The Lender / Investor is only Approving how much of a LOSS they are willing to accept.

3) The Lender / Investor has NO say in the selection of which offer the Seller accepts.

4) The seller should be looking for the offer that is closest to Fair Market Value and more importantly - the one that will close.