Short Sale approval FAQ

4 Replies

Hello Everyone,

Can a bank approve a short sale LESS THAN offered price?

Is it mandatory, for the listing agent or seller negotiator to submit the purchase agreement to the lien holder bank? In other words, does bank need to have a fully executed contract (offer) on the property before they make a decision on the short sale?

Appreciate any inputs.

Can a bank approve a short sale LESS THAN offered price? - Yes

Is it mandatory, for the listing agent or seller negotiator to submit the purchase agreement to the lien holder bank? - I don't know that its "mandatory", but why wouldn't they?

In other words, does bank need to have a fully executed contract (offer) on the property before they make a decision on the short sale? - Yes

Thanks for your inputs @Joe Norman.

Just curious, why a bank would approve less than offered price?  If they have a contract that has offered greater than approval price

Sandy. The bank will approve an offer based off their guidelines in relation to their valuation of the property.

If you offer the bank 200k and it's acceptable, they will not approve an offer less than that because that is what you presented as figures. Could the bank of approved less? Potentially, that is where the guidelines and the banks valuation comes in line. 

The listing agent and borrowers will need to provide real estate documents and financial documents. If the servicer does not have their complete package a decision on the offer and short sale will not be made.

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