Do banks negotiate on short sales?
Do banks negotiate on short sales?
Can You Negotiate A Short Sale? It is entirely possible to negotiate a short sale, but doing so can be a time-consuming process. Instead of negotiating with the seller alone, as is the case with most traditional sales, short sale negotiations must be approved by the lender, too.
How is the price of a short sale negotiated?
Realize that short sales are negotiated between sellers and their bank – Buyers mistakenly believe that they are negotiating with the bank on a short sale. In reality, short sale approval is a process that occurs only between the seller and their lender. Both of them need to agree on the final short sale terms.
Can a bank approve a short sale offer?
Banks are not going to approve short sales offers that are 25%, 30%, 40% lower than the fair market value of the home. In most cases, it will make better financial sense for them to foreclose on the home, rather than approve such an offer.
Do you need a BPO to do a short sale?
Most BPOs are “fair market” price evaluations, meaning that other short sales and bank-owned homes are ignored if there is a sufficient number of regular sales to choose from. Banks know that short sales and REO properties are discounted, but they want a price opinion that assumes a non-distressed listing.
What should I look for in a short sale?
Most short sales come with a lot of back-and-forth negotiations. Therefore, you should focus more on why the bank should sell the home—not how much. If the negotiations go well, you will be guided in the right direction. Use the bank’s counter to formulate a counter of your own, and support it with data.
Realize that short sales are negotiated between sellers and their bank – Buyers mistakenly believe that they are negotiating with the bank on a short sale. In reality, short sale approval is a process that occurs only between the seller and their lender. Both of them need to agree on the final short sale terms.
Banks are not going to approve short sales offers that are 25%, 30%, 40% lower than the fair market value of the home. In most cases, it will make better financial sense for them to foreclose on the home, rather than approve such an offer.
Who is the listing agent for a short sale?
The short sale listing agent represents the seller, not the bank. The short sale listing agent also wants to sell that home quickly. The price the short sale agent deems is market value might be right on the nose or it could be deceivingly low.
Can a home be sold for a short sale?
Not all homeowners are ideal candidates for short sales. If a homeowner cannot prove that she can no longer afford the mortgage, the lender won’t approve a short sale. One negotiation strategy some homeowners use is to intentionally miss mortgage payments in the hope that this will spur the lender’s approval of their short sale application.