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FL ppl: Short sales... tell me what you know (on the buying aspect)....
I'm not sure how much things vary state to state.... but in FL, it seems the majority of homes are short sales. And the area I want to move to... if there are say... 50 houses on the market right now... about 40 of them are short sales!
From what I have heard... short sales are never "short" sales. It's a misleading name. The process could take a few months (anyone know a time frame??) Is it always an "in the air" time frame?
If a house for sale says "3rd party approval" - what exactly does this mean? Does it mean you're in for an even longer wait?
Are short sale prices negotiable? For instance if asking is 279 and its been on the market forever, can we give a lower offer? Or is that wasting time with a short sale?
Also, why do SO many short sale homes say "active WITH CONTRACT?" Is there a reason they keep these statuses active instead of "PNC" (which, on my realtors websites, indicates that the house is under contract and will soon be closing...)
Is it worth it to try and get in a home that's already "active with contract?" What are the chances? Some of the homes I have looked at (not in person just yet) that have everything I want, are "active with contract."
Tell me the good, bad, and ugly regarding short sales.
Re: FL ppl: Short sales... tell me what you know (on the buying aspect)....
I'm originally from Florida, but not there any more. I do keep track of the ss market there though, in case an opportunity to buy a vacation home comes up.
When it comes to short sales, I think it really comes down to the bank. In a place like FL that is absolutely saturated with them, there may be things in place to make them faster. Look for terms like "pre-approved short sale". That means something has already been filed with the bank and the bank has ok-ed an amount. Third party approval needed just means that it's a short sale (likely one where they have not gotten the okay from the bank yet).
Once you find out what bank the short sale is dealing with, you could probably do a bit of online digging to get more info on their typical time frame. There are some banks that are known for being faster than others. You can certainly offer lower on a short sale, but the bank is probably less likely to accept it.
Active with contract houses *could* fall through, but you're probably looking at a longer wait for them than ones that don't have contracts. I'm pretty sure the ones that have contracts are going through the bank approval process. Your agent can probably tell you more since some of that MLS stuff is very local. Everything in our area gets marked "active with contract" until it closes.
I think you have to keep in mind that a ss can be very unpredictable. There are more than a couple of folks on this board who have had big surprises along the way. There are also more than a couple that did very well with them.
Have you looked at homepath.com and homesteps.com? Those will have foreclosures that would be a bit easier to buy since the bank owns them and wants them off the books.
It isn't a misleading name. It refers to the price being "short" of what is owed.
My Valentine Bookends (2~13~13, 2~15~09)
Short doesn't refer to length of time to close, it refers to the loss the bank is taking on the sale of the home (coming up short).
Because there is so much red tape they are very lengthy. Because the homes are insured with the banks, it really isn't worth the bank's while to sell short, but instead to utilize insurance and this is the reason they drag their feet. They want to have the appearance of trying to sell the house so they can actually collect the insurance, but they take so long, many families back out of their deals and then the process restarts, etc etc. We've had friends go over a year with short sales (DC market, people trying to get a deal on homes out in the burbs). Yes, timelines are always in the air.
The third party is the bank approval. They have to approve the offer. It is part of the reason for the wait.
You can offer lower but again, the bank wants to get a certain price and they don't show their hand on what that price is. So you can keep offering and the third party can keep declining up until the dollar loss they are happy with.
By keeping the listing active they are able to solicit back up offers, again, to keep up the appearance that the banks actually are trying to sell, and have continued interest, or in the off chance someone comes along who is willing to pay the price (not likely).
I wouldn't bother trying to get in on an active contract because I don't want to live with a lengthy short sale timeline... especially if they are already screwing someone in the process. I don't need to line up to get screwed, too.
Having said all that, apparently in some areas, some realtors are 'short sale experts' and the short sales only take a few months in some areas and are actually a viable option. In our area our realtors told us they've never seen one go through, and realtors are hesitant to really go into all that short sales entail because of the length of time means money isn't coming in for month and months for them.'
HTH.