Does a Buyers offering price on a Short Sale really matter? You betcha!
As a Listing Agent, when you receive a Buyer’s offering price should you discuss with your Seller and advise them to accept whatever price it is that the Buyer offers, after all, you just need a contract to submit?! I say “NO” absolutely not. We all know that typically we need to advise the Seller of all offers that Buyers want to submit or do submit. Yet what should be done when a low offer comes in that is way outside of fair market value? This has been a issue of great debate. Let’s take a look at how both sides can affect the outcome of a Short Sale:
- Buyer submits an offer that is within fair market value of home
- Offer is submitted to Sellers Lender
- Offer is reviewed by Sellers Lender.
- Value is established with appraisal/BPO
- Offer is within fair market value range of Lender’s established value
- Seller’s Lender approves Short Sale; Average processing time of 60/90 days for the Short Sale
- Sale closes 30 days later
2. Buyer submits an offer that is not within fair market value of home; low ball offer.
- Offer is submitted to Seller’s Lender
- Offer is reviewed by Seller’s Lender
- Value is established with appraisal/BPO
- Offer is determined to be outside of fair market value; below minimum acceptable by Lender
- Lender counters or rejects Buyer’s offer
- Buyer will not accept Seller’s Lenders counter offer or simply isn’t qualified to pay the higher needed sales price
- Offer is cancelled. Average processing time of 60/90 days for the Short Sale has now been wasted due to the Buyers original offer price not being countered at the onset. Wasting of precious time when a Seller is on a time frame deadline to be sure to avoid foreclosure.
- Home back on the market for sale
Some will argue that any offer is better than no offer, yet if you have a pricing strategy in place for your Short Sale Listing you should be getting acceptable offers. Why waste everybody’s time with an ineffective offer? Plus, as a Real Estate Agent it questions your professionalism and knowledge of the market, I believe.
Mortgage Assistance Relief Services Disclosure
Keller Williams Partners Realty is not associated with the government and our services have not been approved by the government or your Lender. If you stop paying your mortgage you could lose your home and damage your credit. Your Lender may not agree to the change of your loan and/or a Short Sale.With a Short Sale, there are no guarantees offered and we cannot provide legal advice. Seek legal advice.
