Or....“Moderately lengthy transaction requiring the patience of Job".
“Short sale”...Is “Sold short”....Sold for less than is owed.
The process can be anything but short....here’s why: the Lender gets to approve, deny, or counter offer all terms accepted by the Seller.
Sort of like bringing your Mom to football practice.
The Coach tells you to run a specific play, but the ear peice you’re wearing has your Mom’s voice yelling at you to change the play after it’s begun.
The short sale process generates more client questions than any other blog topic .
If you used an FHA loan to purchase your home, the Lender goes directly to an appraisal, and an agreed upon homes sale value. No exceptions. If this is you, call me now.
More traditionally, first step....The Seller accepts, rejects, counter offers your offer....Then the Listing Agent delivers the executed offer to the Lender. The Lender reviews the offer, as well as the pre-qualification information delivered bu the Seller, and makes the decision to include the Seller in the short sale program.
At this point, depending on the type of loan the Seller used to buy the home, (and the Lender’s processes) the specifics may change, but the next step is the same.
Second Step....Determine the fair market value of the home.
Again, if you used an FHA loan to purchase your home, the Lender went directly to an appraisal, and an agreed upon home sale value. If used an FHA loan to purchase your home, call me now.
More traditionally, Lender sends a licensed Agent to construct a Broker Price Opinion, or BPO, which is then submitted to the Seller’s Lender.
If the numbers “work” with the offer, an appraisal is then ordered.
As an aside, many Lenders are discontinuing the BPO practice; turns out most Agents send values back that reflect the loan values, in an effort to get and stay in the Lender’s good graces...In that way, the Agent gets more new BPO requests, for which they are paid $150-$250 per BPO.
Read our blog on “Broken Price Opinion” to find out about the scam involved to artificially inflate the value of your home.
Third step, the Lender matches the appraisal to the offer, and gives a yes/no.
Until you receive an approval letter from the Lender, the answer is “no”....No such thing as a verbal acceptance in a short sale.
The clear to close/acceptance letter leads directly to closing.
Many times the Buyer’s Agent isn’t prepared for the approval, leading to delays in closing, and sometimes leads to cancellation of the approval.
The process may take a few weeks, or more than a year.
Yes, more than a year.
Many variables can lengthen/shorten the process....Most of this is outside the Seller’s or the Buyer’s control, so much like a roller coaster, once you get on, enjoy the ride, or get off!
For more on whether or not a short sale purchase is the roller coaster for you, give me a call.
“Short sale”...Is “Sold short”....Sold for less than is owed.
The process can be anything but short....here’s why: the Lender gets to approve, deny, or counter offer all terms accepted by the Seller.
Sort of like bringing your Mom to football practice.
The Coach tells you to run a specific play, but the ear peice you’re wearing has your Mom’s voice yelling at you to change the play after it’s begun.
The short sale process generates more client questions than any other blog topic .
If you used an FHA loan to purchase your home, the Lender goes directly to an appraisal, and an agreed upon homes sale value. No exceptions. If this is you, call me now.
More traditionally, first step....The Seller accepts, rejects, counter offers your offer....Then the Listing Agent delivers the executed offer to the Lender. The Lender reviews the offer, as well as the pre-qualification information delivered bu the Seller, and makes the decision to include the Seller in the short sale program.
At this point, depending on the type of loan the Seller used to buy the home, (and the Lender’s processes) the specifics may change, but the next step is the same.
Second Step....Determine the fair market value of the home.
Again, if you used an FHA loan to purchase your home, the Lender went directly to an appraisal, and an agreed upon home sale value. If used an FHA loan to purchase your home, call me now.
More traditionally, Lender sends a licensed Agent to construct a Broker Price Opinion, or BPO, which is then submitted to the Seller’s Lender.
If the numbers “work” with the offer, an appraisal is then ordered.
As an aside, many Lenders are discontinuing the BPO practice; turns out most Agents send values back that reflect the loan values, in an effort to get and stay in the Lender’s good graces...In that way, the Agent gets more new BPO requests, for which they are paid $150-$250 per BPO.
Read our blog on “Broken Price Opinion” to find out about the scam involved to artificially inflate the value of your home.
Third step, the Lender matches the appraisal to the offer, and gives a yes/no.
Until you receive an approval letter from the Lender, the answer is “no”....No such thing as a verbal acceptance in a short sale.
The clear to close/acceptance letter leads directly to closing.
Many times the Buyer’s Agent isn’t prepared for the approval, leading to delays in closing, and sometimes leads to cancellation of the approval.
The process may take a few weeks, or more than a year.
Yes, more than a year.
Many variables can lengthen/shorten the process....Most of this is outside the Seller’s or the Buyer’s control, so much like a roller coaster, once you get on, enjoy the ride, or get off!
For more on whether or not a short sale purchase is the roller coaster for you, give me a call.
RE/MAX sells more homes than any other real estate company.
For a reason...should we talk?
Blog post written by the Dowell Taggart Team of RE/MAX Premier Realty
Comments are appreciated! Go ahead and add your 2 cents . . .
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