Investor · Miami, FL · Member since 2012 · 136 posts · 5 votes
Im not here to whine about inventory, but i noticed all the competing rehabbers are getting short sales, and guess what! IM NOT!. As I have never dealt with a short sale transaction I am leaning towards having an agent who is experienced in these matters work with me on finding deals and submitting offers. I did find one agent who is pretty experienced, but she wants me to sign a 1 year exclusive agreement with her, (which I could understand for short sales), but thats all I would want to keep it to, i am meeting with her tomorrow but was wondering if anyone had any advice on whats acceptable before i sign my life away on the dotted line? I have failed miserably trying to work with the short sale listing agents directly.. i feel this is my next option
I would never lock in exclusively, as then she has the right to simply ignore you yet still get a commission if you buy on your own, even if she didn't help you at all. Most agents I've worked with agreed right up front that the only buyer-broker agreement I would sign would be property specific and done at the time of writing a contract on a house they've showed to me. I think one agent used to bring a form with a list of the houses he was showing me that day saying I was using him on those specific properties if I chose to put an offer on any of them within 6 months. That made sense to me. If she pushes you on the one-year exclusive, I'd, personally, look elsewhere for an agent.
yes, here's the advice - do not work with just one agent.
do not work with a buyer's agent for short sales.
work with them for HUD homes only.
Whats the best way to submit an offer to the listing agent? can i just send them a standard contract with proof of funds and hope to heck they use my offer when sending the shortsale package to the bank?
As an agent myself, I wouldn't appreciate someone's using my time and not being compensated. However, I understand that you wouldn't want to be locked in for a year if she doesn't perform. So I agree with Lynn M. that you can ask her to sign the representation agreement for those properties that she shows you and/or helps you through the process.
And be ready for a potentially very long waiting period to get the banks to accept your offers :).
you see a house you like, call up the LISTING agent and tell him, "I want to take a look at the house, bring the papers so i can sign it right there".
they might ask for "proof of funds" or whatever.. either bring it with you or send it to them later.
do the same thing with the next listing agent.
it's really that easy.
Do you typically ask for seller concessions like 3% or more? are your offers contingent on them accepting by a certain time? I dont mind waiting for a response, but what if 7 months goes by and ive found 4 other deals i could have done, i would like to be flexible with my funds if the bank is going to take its sweet time deciding what to do
i can always say "i want my money back, moving on".
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This is the part im stuck on, how long are your offers initially good for? and do you put emd in escrow right away or upon acceptance.? is there 5 major points you could make suggestions for when offering on short sale? mainly, EMD, Acceptance timeline, extension, that sort of thing? I really dont mind offering a larger EMD
hm, the items i told you above is really all there's to it.
- meet with them, look at the house
- place offer (the earlier the better these days)
- give them a copy of proof of funds
- if accepted, meet to give them 1k emd. no need for more
- forget about it until it happens. if it happens.
most of the time it might not happen or they might want more docs.
hm, the items i told you above is really all there's to it.
- meet with them, look at the house
- place offer (the earlier the better these days)
- give them a copy of proof of funds
- if accepted, meet to give them 1k emd. no need for more
- forget about it until it happens. if it happens.
most of the time it might not happen or they might want more docs.
that's it, mike...
I read somewhere that you should make your offer good for 120 days, if only 30 days most banks will throw it away, would you agree with this? if not what time frame do you make the offer good for?
I never specify... I have two in the works right now. If they happen.... good. If they don't, I move on. I gave them both 1k emd and don't Need the money. If I needed it, I will tell them I found something else and need too get it back..
I never specify... I have two in the works right now. If they happen.... good. If they don't, I move on. I gave them both 1k emd and don't Need the money. If I needed it, I will tell them I found something else and need too get it back..
Did you give them 1k emd before acceptance? do you draft the contract to say " this agreemnet is good until acceptance or rejection by lender" ?
EMD on a short sale should not be given to the seller under any circumstance; always put it into escrow if you have an agreement where the EMD is funded before the short sale approval. Better to wait until after short sale approval to give EMD, but that is another matter ...
Typically, you'll give EM when accepted by owner, and a deadline for bank approval within 90-120 days. If approval is not obtained by then, you have right to cancel, or extend the approval deadline. Anything less than 90 days for the shorted lender approval is usually not enough time.
While we have always subscribed to using an "expert" in areas we are not familiar in, we made the mistake last year in using a buyer's agent for a short sale.
We found the house on our own and contacted a buyer's agent to place a bid. We now know better than to allow an agent to pursuade us to raise our opening bid. Also, we should have recognized the red flag when she advised us that it was a long process and that she hadn't had many short sales actually close.
Despite our agent, we did finally close on the short sale 6 months later. As far as both the buyer's agent and seller's agent were concerned, the dates on the offer and addendums really didn't amount to a hill of beans when dealing with banks and short sales. The bank will respond and do what they like when they get around to it.
With that being said, legally we had an out to walk away during most of the process due to the lack of response from the bank. If we were to do the deal again, I would probably give the bank 30 days to respond rather than the week or two typically given in a standard Michigan sales agreement.