The bank that holds the mortgage wants the seller to stay in the home right up until close of escrow.  Once we list a home, we should be able to put it into escrow within a month or two.  Then the process of getting the short sale approved begins.  This can take around 3-4 months.  Once approved, close of escrow is usually within 45 days.  That means most short ssale seller’s can stay in their home for at least 4-5 months from the time they list their home here in Southern Nevada.  No two deals are alike and it could be as little as 2 months  or as much as 14 months.

If you are worried about where you will land once you sell your short sale here in Las Vegas, don’t worry too much.  There are plenty of landlords that are happy to lease homes to recent short sale sellers.

They have since been resistant and perhaps even defiant in wanting to proceed with foreclosures.  That is the concern.  Will the banks allow these additional requirements to impede their ability to get homes to market?  While they may not be pleased with the process and it will cost them more time and money, I think they will get their procedures in order and eventually we will see the market stay on its course.

That means that while we are in the holiday season and approaching a new year, the number of foreclosures will remain low, but they will pick up in the first or second quarter of next year and the inventory will continue to remain at the levels we have seen in the last 30 months.

The impact on homeowners desiring desire to short sale their homes is still unclear, but the banks have all concluded that short sales are far more favorable than Foreclosure and this legislation will certainly not change that opinion.

When we receive a low offer on our listings, we will counter back to a price that we deem a good value to the buyer and reasonable to the lien holder.  We also counter out the costs that we know the lien holder will not allow and we counter with information to the buyer and buyer’s agent that enables us to know that the buyer fully understands the nature of short sales.  Sometimes the buyer decides to reject our counter.  That’s OK because it’s likely that buyer wasn’t going to be patient enough to endure the process.  We would rather leave the home on the market to attract another buyer that will endure and help us to close the escrow.  If the buyer agrees to our counter offer, then we know we have a quality buyer that will be there when we get an approval from the lien holder.

When I’m working with a buyer that chooses to make an offer on a short sale, I will pull the comparable sales to evaluate the fair market value just like the lien holder will do upon receiving the offer.  This gives my buyer the information well ahead of a counter we may get later in the process.  My buyer will be prepared for the idea that the lien holder will likely counter back at a number that is close to fair market value and my buyer is prepared to accept that counter and proceed.  If the lien holder doesn’t counter and accepts my buyer’s offer, even better!  My buyer gets the great deal!

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The way we have succesfully moved forward under these circumstances is to encourage the buyer to accept the counter and invest in an appraisal from their own lender.  We sometimes extend the buyers additional diligence so they don’t have to spend money on an inspection if they don’t go forward on the deal.  What this does is gives us an actual appraised value on the home and the lender that has to approve the short sale is faced with the reality of that appraisal.  The short sale lender has reduced to the appraised value each time we have done this and the buyer has been able to close the deal at a true value.

There is some risk on behalf of the buyer, because if the appraisal comes in at the inflated number, then the buyer has to choose whether to move forward or not.  I would point out that if an appraiser brought in the value, it is most likely accurate as most appraisers these days find it very easy to bring values in low.

Just another twist in our ever evolving real estate market!

Now that banks control a large portion of our market, the agents have educated the buyers to know that it may be weeks for a reply or you may never hear at all!  (The listing status may just be changed to “no longer available” in the computer).  Why are we dealing with short sales in the same manner which is disrespectful to other agents and their clients?????

In a short sale, the seller of the property (NOT the bank with the mortgage!) signs the offer.  Have we not prepared our sellers to be available to accept an offer??  The seller should be encouraged to sign an offer with a buyer that has these important qualifications:

1.  Time to wait for the short sale to be approved.

2.  Education that some of the costs they ask for may be turned down by the bank approving the short sale.

3.  An “at list” offer- not a crazy bidding war offer.  The bank with the short sale may ask for more so the buyer’s agent needs to prepare the buyers that they may have to increase their offer. 

4.  A professional agent that addresses the above items in the letter accompanying the offer.

5.  An investor’s offer may not be the best offer because generally, they are making more than one offer.

6.  Finally, EARNEST money with the offer and a willingness to place it in escrow!

Let’s answer (in a timely manner), the buyers that are willing to give us an offer that comes closest to meeting the criteria above!  Let’s see some professionalism in real estate in cases where we have some control.