Short Sales?

For those who purchased short sales I was just wondering how much less you offered from the asking price and if the bank approved your offer.

TIA!

Re: Short Sales?

ours dropped like 40000 then we offered 19000 less then that price.. so a considerable amount..

Re: Short Sales?

kim, find out how much the mortgage or mortgages were for - its public info so you may be able to look it up yourself....

also figure out what the current market value for the house is - see what the comps in the area are selling for - the bank will do their own appraisal of the house to see what the current value is - from what i've seen and read they will usually take 85% of the what the house is worth now - but again that also depends on if there are 1 or 2 mortgages and how much those mortgages were for....

for us the guy had 2 mortgages - one for 80% of the purchase price (he put 20% DP) and then he took out a second mortgage against the house for another 60K about 1 year later - i guess he was able to do that b/c the house's value kept going up....it was new construction 05 and then the prices were inflated into 06 and 07......

so for us, the mortgages were for 248,000 total - we offered 170,000 on the property....i'd say its worth about 200,000 in todays market if it wasnt selling as a short sale - other comps of this home (same model, same neighborhood) that are not short sales are listed in the 215-220s but they are not selling b/c there are so many shorts and forclosures...

the realtor had the house listed at 175 - in florida where we are looking they are getting really good with the listing price - listing them close to what they think bank will accept - so you cant really offer less b/c they are listed at the bottom...

our scenario is that the 1st mortgage will get about 160K (not bad considering their loan was for 188K - they are getting most of their $$ back) - and the 2nd will get 3K (its supposedly the new guideline for any fannie/freddie loans, that the 1st can only offer the 2nd a maximum of 3K) and then rest goes to the realtor fees and such....the 2nd mortgage is trying to squeeze another $2,600 out of us and at this point we are stuck - we want to pay it so we can get the house but its tricky with the mortgage - they are trying to figure out if we are even allowed to give the 2nd mortgage more money....hopefully today the issue gets resolved....

short sales can be torture....we put our offer in jan 19th and its MAY and we still aren't out of the woods - we may not even get the house after all of this b/c of the 2nd mortgage

but anyway, i hope i helped....ive read so much about short sales in the last 4 months but most of my knowledge is about the florida market...

best of luck to you!!!

Re: Short Sales?

I have an offer in on a foreclosure

the thought process which for the offer was half of the value

$400K house

orginal offer $200K

second offer - $150K after we found out a pipe burst in the basement

we didn't take into consideration what the person owed (much more then $400K)

the house needs about $50K worth of work- with out the pipe issue

I should add my BF is a real estate investor- so he is handling the whole thing- I am still learning about this end

Re: Short Sales?

We offered the asking price. We knew the neighborhood and after seeing other places that were expensive (and in worse shape) we knew it was a good deal.

It was assessed for 15k more than what we got it for.

Re: Short Sales?

i would say that most of the time the list price is pretty close to what you should be offering...usually list prices are what the realtor *thinks* the bank will accept....other times the list price is lower than what the bank will actually accept and the listing agent uses that as a tool to get attention and multiple offers....i would talk to your realtor - if they are any good they will have the best advice on how strong your offer needs to be....

Re: Short Sales?

Posted by Nik211

kim, find out how much the mortgage or mortgages were for - its public info so you may be able to look it up yourself....

also figure out what the current market value for the house is - see what the comps in the area are selling for - the bank will do their own appraisal of the house to see what the current value is - from what i've seen and read they will usually take 85% of the what the house is worth now - but again that also depends on if there are 1 or 2 mortgages and how much those mortgages were for....

for us the guy had 2 mortgages - one for 80% of the purchase price (he put 20% DP) and then he took out a second mortgage against the house for another 60K about 1 year later - i guess he was able to do that b/c the house's value kept going up....it was new construction 05 and then the prices were inflated into 06 and 07......

so for us, the mortgages were for 248,000 total - we offered 170,000 on the property....i'd say its worth about 200,000 in todays market if it wasnt selling as a short sale - other comps of this home (same model, same neighborhood) that are not short sales are listed in the 215-220s but they are not selling b/c there are so many shorts and forclosures...

the realtor had the house listed at 175 - in florida where we are looking they are getting really good with the listing price - listing them close to what they think bank will accept - so you cant really offer less b/c they are listed at the bottom...

our scenario is that the 1st mortgage will get about 160K (not bad considering their loan was for 188K - they are getting most of their $$ back) - and the 2nd will get 3K (its supposedly the new guideline for any fannie/freddie loans, that the 1st can only offer the 2nd a maximum of 3K) and then rest goes to the realtor fees and such....the 2nd mortgage is trying to squeeze another $2,600 out of us and at this point we are stuck - we want to pay it so we can get the house but its tricky with the mortgage - they are trying to figure out if we are even allowed to give the 2nd mortgage more money....hopefully today the issue gets resolved....

short sales can be torture....we put our offer in jan 19th and its MAY and we still aren't out of the woods - we may not even get the house after all of this b/c of the 2nd mortgage

but anyway, i hope i helped....ive read so much about short sales in the last 4 months but most of my knowledge is about the florida market...

best of luck to you!!!