mickey16_60160 asked:


I made an offer on a house that is a short sale on last Thursday. It was priced for 175000 and we offered 170000. I still am waiting to see if they accepted my offer. I am willing to give the full price if that will speed the process up. My realtor said it is a good offer and it is being reviewed. I do not want to keep bugging my realtor and asking if she has heard anything from the bank. I want to know why is it that the bank takes long to see if they accept your offer. Is their a procedure with short sale homes? This would be my first home and I really like it. Tire of paying rent. Property is in Illinois if that makes any difference.
I just called the record of deeds and they said it is actully in forclosure. Soes that make a difference?

Kanesha

9 Responses to “why do banks take a long time to see if they accept your short sale offer?”

1. porcelina_68 on March 7th, 2009 11:46 am

   They are slow with everything like that, except, of course, a foreclosure. I was told I’d have loan modification paperwork within 7-10 days – and that was 3 weeks ago.

2. John T on March 10th, 2009 10:37 pm

   I’m not sure. I’d guess that taking a loss on a property requires a pretty senior person to approve the deal, and that person simply is unavailable to approve your transaction

3. dave c on March 16th, 2009 10:34 pm

   The banks have to go up there chain of command often to get an answer on these issues when they are letting assets go for less then what they lent on them. I know the banks have a bureaucracy much like government large and cumbersome.
   Imagine you business model if you are a banker you often spend much more effort in the area of making new loans and gathering new good cash flowing business rather then making time to clean up the mess that was made 2 to 5 years ago.
   In addition some banks are less equipt to deal with negative assets on there balance sheet then others. This coupled with the fact we are seeing record foreclosures may make it a numbers game too. Some banks today just cannot keep up with the bad mortgages in there portfolio.
   Just be patient and be firm on price there is no rhyme nor reason to there decision making. Often and some times if they have to get rid of something because of annual reporting you may see property discounted over 50% after its finally sold.
   The banks want to return to normal to do more business and get profitable but they also have people within the organization that may have made the bad loans and the politics are such make an impact on how the bad loans are managed. You will see this a lot in smaller banks.
   Good luck and happy hunting this low market is a great time to get a good deal. its a buyers market be firm and don’t let a banker out negotiate you its his bad loan not your make your self a grand deal. Its great to make low ball offer to big bad bankers. Remember its never to late to renegotiate, up until you close you have that ability. i like such contingencies as inspection before closing and ect.

4. Lori S on March 16th, 2009 11:45 pm

   Short sales typically mean the bank is selling for less than is owed by the current owner. They may be waiting to see if a better offer comes in.

5. Patrick on March 17th, 2009 5:35 am

   A Short Sale is not a quick process. Basically the bank is accepting less money for the house than is owed on it. If the proper procedure was followed the bank agreed to accept $175,000 for the house as a negotiation between the lender and the current owner.

   You made an offer below their price. They have a process to follow and people will need to sign off on the deal.

   Remember, that a bank is in this to make money, not lose money. Some of the things they look at in a short sale situation is if it will be cheaper to do the short sale or foreclose. If they think they can foreclose then turn around and sell the house and make more then your offer they will just foreclose.

   They will also look to see if there are other offers on the property. Remember, it costs the bank nothing at this point to take their time in making the decision. The current owner is still on the hook for payments.

   My question to you is if you felt that the house was worth $175,000, as you stated you would have paid that, why did you try to lowball the offer? If it was just to see if they would budge then you have to wait to see if they will budge. If you wanted the house quick you should have made the full price offer.

6. L J on March 19th, 2009 11:02 am

   The real reason is that our banking system is not really prepared for all that is going on. As for whether or not they accept your offer, probably depends on the mood of the person who reviews it.

7. PIE R SQUARED on March 22nd, 2009 5:30 pm

   Now you know why you do NOT buy a bank owned property. They take forever to make a decision. Make your offer good for 48 hours. If no answer by them, move on to another house.

8. acermill on March 25th, 2009 1:44 pm

   Banks always take their time on such short sale offers. Right now, they are investigating to see if they think they might come out better by allowing the house to go to foreclosure. With lenders, it’s always bottom dollar which counts. As well, they may be waiting to see if any other offers are tendered which are better than yours is.

   I’ve seen short sale offers drag on for a month.

9. Laurie the Realtor on March 28th, 2009 6:19 pm

   The reason it takes so long is that the mortgage company actually has to get approval from the investors that initially lent the money for the loan. Most of the time the investors are in different parts of the country and it takes a while for them to get in touch with them and get approval. Ofcourse not to mention the fact that the deal can’t be assigned to a work out negotiator until a contract is submitted and then they have to tell the seller what items theya re missing in order to process the short sale request… The entire approval will take about a month for you to hear back.