Short sales. Where do I start? I’ll begin with a story.
Approximately six months ago, I listed a property in Northern Virginia. The owner, let’s call her Jane, had purchased her home at the height of the market. She was interested in moving and wanted to sell, but could not get enough right now to cover what she owed on her mortgage loan. So we listed her home for sale as a short sale. Here’s what went down.
Jane provided the bank with a hardship letter and I listed Jane’s property. We received an offer pretty quickly. It wasn’t a full price offer, but not too far off.
Jane agreed to the price and terms and the offer was signed and sent to the short sale negotiator I work with. The home was changed to “Under contract” in the MRIS. Six weeks passed and the bank came back with a counter offer (which was a little bit lower than the price I listed it at). The prospective buyers decided not to counter the counter and completely backed out. At that point I relisted the property as an approved short sale at that price.
Fast forward one month. No acceptable offers at all - just a couple of "low balls" which we knew wouldn’t fly with the bank. We then decided to lower the price a little. Fast forward a month. Still no acceptable offers. Keep in mind all this time my seller has had to deal with potential buyer’s viewing her home day in and day out and all the stresses that come with having your home for sale.
Why doesn’t Jane just accept any other offer? Because it’s a waste of time to ratify another offer which the bank ultimately won’t accept. Then the home has been off the market again for no reason, thereby removing it from the view of potential buyers who may be willing to purchase the property at full price. So we wait for a full price offer, but it never comes even though other homes comparable to hers have sold for even higher. Frustrating, to say the least.
In a nutshell, selling and buying a short sale is never easy. It’s a gamble for a buyer and seller that may or may not pay off. To purchase a short sale you need patience and a Realtor that knows what they're doing. You also need to realize that banks want fair market value and are willing to wait for the right offer. Also realize short sales are "as is" and you can wait a long time for a response from the bank.
If you are a short sale seller….good luck! And be sure to work with a Realtor, such as myself, that works with a free-of-charge negotiator and has experience dealing with the complications that most likely will arise.