One of the million-dollar questions that I receive from Sacramento short sale sellers is when should they stop showing their homes. The answer to that question depends on the individual short sale, they are each unique, but typically the answer is when the seller has accepted an offer. However, it also depends on the type of offer the seller has agreed to accept.
See, the thing is when a short sale goes into active contingent status, it's basically no different than a pending sale status on a regular transaction. The implied difference between a regular pending transaction and an active contingent short sale is the short sale will take longer to close.
Whether the transaction is a short sale or a regular sale doesn't make much difference because in each there is a seller who has agreed to sell to a buyer and a buyer who has agreed to purchase the home. Now, some buyers are writing multiple offers, hoping to grab the first short sale that gets approved. But I advise my sellers to not accept those types of short sale offers. I know the signs to look for and how to take precautions to lessen the chance that a Sacramento short sale seller will end up in contract with a buyer who is unlikely to perform.
Besides, a back-up offer received in the early stages of a short sale probably won't be in the game by the time the lender approves the short sale, even if the first buyer walks away. That's because some short sales take 3 to 4 months or longer to close, depending on the short sale lender. Very few buyers will wait months just to see if the first buyer backs out. Most buyers actually want to buy a home and close.
As a busy Sacramento short sale agent, I generally receive so many offers on my short sales that I have plenty of buyer's agents to notify if the buyer who is under contract gives up the ghost. But I always give sellers the choice of whether to let buyer's agents continue to show or to change the listing to reflect no more showings. If the seller's buyer appears solid and committed, there is not much to gain from continuing to show the home.
A seller emailed me yesterday to say that twice 2 different buyer's agents called her, demanding to see her home. She explained that short sale approval is on the horizon (because her bank told her so), that her home is listed as an active contingent, the buyer is dedicated and the listing states no more showings. In both cases, the agents insisted that active contingent meant they could show it. No, sorry, guys, it doesn't mean that at all. In my short sales, it means it's in escrow. Moreover, when a listing says no more showings, it means no more showings. But to some agents, "no more showings" must carry some other connotation.
Some buyer's agents ask if I will call them should an active short contingent blow up for some reason. Sure. But there's no special treatment. If the existing contract cancels, isn't it better for the seller to put the home back on the market? Because putting the home back on the market is exposing that home to a greater pool of buyers, some of which might pay a higher price. Making back-door deals isn't in the best interest of the seller. Buyer's agents have access to MLS, and MLS will tell them if a home is available for sale or back on the market.
Comments(10)