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Short Sale Low Ball Offers

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Short Sale Low Ball Offers

Massachusetts short sale home cash

There is no question that short sales are like the wild West. Almost every single sale is different. Each lender and even the investors that hold the loan may have different procedures on how they want things done.

There are some folks that believe that because a home is a short sale it is an automatic invitation to make an unrealistic low ball offer. Even some Realtors who have not been educated on the dynamics of a short sale believe they are just like a bank owned property.

Part of the problem could be late night television where you see so called Real Estate guru’s telling you how to buy and sell Real Estate to become an instant millionaire. Fat chance!

The kind of garbage spewed on these late night shows could not be the further thing from the truth. While Short sales and REO’s are both considered distressed properties they are nothing alike.

If you are short selling your Massachusetts home this becomes a very important point.  There is a strong likelihood that you will may receive an offer that should not be accepted.

The problem with a lot of short sale transactions is that Realtors are jumping in and representing sellers with no knowledge of the process. If the Realtor you have hired does not know how to guide you properly how can you expect to have any success?

If you are a Massachusetts home owner who is short selling a home what you really need to understand is that the lender is going to send a representative out to your home after it has gone under contract to do an appraisal or broker price opinion. The lender is doing this to find out what the fair market value is for the property. If the offer that you have accepted is not within the ball park of the actual value of the property your short sale is going to be REJECTED!

The worst part of this is that you probably will already have been waiting for months to find out if the short sale was going to be approved. If the buyer does not increase their offer to the banks counter proposal, the deal will be dead and you will have wasted an awful lot of precious time. Maybe time that you don’t have if the lender decides to start foreclosure proceedings.

Massachusetts short sales take a long time

This is where your Real Estate agent should have counseled you properly.
In a short sale your home should be priced aggressively in order to get
an offer as quickly as possible but not so much that it will be turned
down by the lender.

On a weekly basis I am seeing agents improperly handle short sales by either submitting low ball offers signed by the seller to the bank or collecting multiple unsigned offers and just submitting them all like some kind of free for all. This is NOT the way to handle a short sale!

An offer should be collected from someone who has a strong desire for the property and is willing to wait the time it takes for short sale approval. Generally speaking most short sales take three to six months to get approved. The buyer you work with should be educated on this fact.

The contract should be executed by both buyer and seller. I would also suggest some kind of clause that locks the buyer in for some amount of time to wait for short sale approval. On all my short sale contracts the buyer is required to wait for a minimum of 90 days or they would forfeit their escrow deposit which typically is 5% of the homes purchase price.

If you are going to short sell your Massachusetts home make sure you pick a Realtor with experience in getting these transactions completed! Accepting low ball short sale offers is just one of many mistakes you will want to avoid!

Click on the links below to see other important information related to a Massachusetts Short Sale:

If you are needing to complete a  short sale of your home or condo in Ashland, Bellingham, Framingham, Franklin, Grafton, Holliston, Hopedale, Hopkinton, Medway, Mendon, Milford, Southboro, Westboro, Natick, Northboro, Northbridge, Whitinsville, Upton, Uxbridge, Shrewsbury, Worcester, or Douglas Get in touch! I would love to interview for the chance to represent your best interests.

I am successfully completing short sales through out the Metrowest Massachusetts area. So far, knock on wood, I have a 100% success rate for short sale approval!

If you are outside of the Metrowest Massachusetts area and need to do a short sale please feel free to contact me and I would be happy to refer you to a Realtor in your location that handles short sales and knows what they are doing! I have referred short sales to other Realtors all around the country.

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About the author: The above Real Estate information on Massachusetts short sale low ball offers was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-435-5356. Bill has helped people move in and out of many Metrowest towns for the last 24+ Years.

Thinking of selling your home? I have a passion for Real Estate and love to share my marketing expertise!

I service the following towns in Metrowest MA: Ashland, Bellingham, Blackstone, Douglas, Framingham, Franklin, Grafton, Holliston, Hopkinton, Hopedale, Medway, Mendon, Milford, Millbury, Millville, Natick, Northboro, Northbridge, Shrewsbury, Southboro, Sutton, Wayland, Westboro, Whitinsville, Worcester, Upton and Uxbridge MA.

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{ 9 comments… add one }

  • Renee Burrows January 10, 2011, 4:45 pm

    So many agents gripe at the high BPOs/appraisals but I have a feeling they should probably look in the mirror at their pricing strategies if they have this problem on a continuous basis. I understand it happens every now and then but not all the time!

  • Michael Lang, CDPE January 10, 2011, 8:10 pm

    Although I would agree that late night television indeed does not help, I would absolutely say that the biggest problem are uneducated agents in the area of short sales. Maybe one day NAR and local boards will require agents to be certified in order to deal in any aspect of short sales. Great article though Bill, much appreciated!

  • James Burton January 10, 2011, 8:13 pm

    As a real estate agent in the Seattle area I understand these low ball offers but gladly accept the first one (as long as it is not less than 15-20% of approx current value). With a lot of agents in our area not wanting to show “short sale” listings I use this offer to get from the bank what they will really accept and then can market the home with an approved value. This makes a huge difference in getting agents to show short sale listings.

  • Shannon Lefevre January 10, 2011, 9:25 pm

    I will be happy when we say, “short sale” and everybody in the room looks at you like you’re crazy because it’s a thing of the past….

  • Bill Gassett January 10, 2011, 10:48 pm

    Michael – I could not agree with you more! There are so many egregious things that are being done by Realtors representing short sellers it is absolutely mind boggling. Unfortunately many sellers do not realize that short sales are specialized transactions that need someone who really knows what they are doing.

    James – That does not sound like the best approach to me. So you are saying that if a home has an actual value of $300,000 for example, you would accept an offer of $240,000 and submit it to the lender? It seems to me that you do not have someone that is doing a good job with the short sale negotiations if you need to go to that length. While it is easier to get an agent to show an approved short sale most of them are not. A skilled short sale agent should have a strong understanding of property valuation and the knowledge of what a lender would accept based on the value. Accepting a low ball short sale offer certainly wastes a lot of time for the seller and could result in them losing the home to foreclosure depending on where they are in the process.

    Shannon – I hate to see anyone in financial difficulties but actually like short sale transactions:) They are easy to complete if you know what you are doing. Typically priced well and offer good value to a buyer.

  • MaryBeth Muldowney January 11, 2011, 4:21 am

    Bill you are so on the money whereas they are so off the dollar on their offers. Not only does this type of offer hurt the buyer and eventually the seller and the Realtors involved but having these listings in MLS with unrealistic asking prices have tainted the whole marketplace.
    Great Post and so timely. Regards MaryBeth

  • Joy Baker January 12, 2011, 2:49 am

    As always Bill, right on the mark! All anyone has to do is look at the statistics regarding short sale listings vs. closed short sales to realize that many, many agents have no idea what they are doing.

  • Bill Gassett January 14, 2011, 11:28 pm

    Thanks Joy! The things that I see some Realtors doing in short sale is just plain absurd. It really gets me angry when I see Realtors taking business outside of their area of expertise. So many seller’s do not realize the proper way to handle short sales and don’t know when their agent is making big mistakes.

  • Kevin Vitali January 23, 2011, 6:08 pm

    Bill I agree with you. Properly pricing a short sale coming out of the gate and securing a good offer up front can save lots of time and aggravation during a short sale to begin with.

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