Good afternoon BP!
I had a question about a Short sale that I came across. I found a great property for $102k in my neighborhood, most houses in my area sell for about 170-190k. I was wondering if any of you were able to negotiate with a Short sale deal since it is a bank that owns the house and it might be harder to negotiate with them. It needs alot of renovations done to it, maybe new piping, ac, sheetrock work, it has some mold, needs updated kitchen and bathrooms, new flooring and paint. Is there a way I could negotiate with the bank to lower their price to sell to me since It needs alot done to it before I can rent it out? If anyone has any suggestions let me know.
Thank you very much.
First, of it's a short sale the bank doesn't own it, the borrower still does. And yes, the price is negotiable, but the bank wants as close to current value as they ca get. Generally, the list price has no relation to whatever price the bank may accept, whether higher or lower, as usually the bank has no idea what price the owner listed it for. You won't know that prices intil usually45-60 days after your accepted contract is submitted.
thank you for clearing things up
I am a realtor and whenever a client asks me to help them buy a short sale, and it is not a listing of mine, I have the buyer sign a brokers agent agreement to compensate me directly out of their own funds for the purchase. That way the listing agent is able to take the full commission from the bank and will be more willing to fight the bank for the lower price that you want.
For example, normally commission is split between the listing agent and selling agent.If the house sells for 100k, and the commission of 6% is split between buyer and seller, here is how the numbers play out:
Cost to buyer: 100k.Listing agent 3K, buyer broker 3K
If you have your buyer broker negotiate the deal for a sale price of 75K, with you paying the buyer broker 5K from your pocket, here are the numbers:
Cost to buyer: 80K (75k purchase price + 5K commission), listing agent $4,500(6% of 75K), Buyer Broker 5K
Net result is listing broker has more incentive to fight for your lower price.
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