Northern Nevada Short Sale Counter Offers ... The Rest of the Story!
You’ve waited for weeks or months after your Short Sale offer was accepted to hear something and then your Agent calls with news. She’s heard from the bank. The bank countered your offer. Say what? “What do you mean countered my offer?" If you are like most people, that is your initial response. Of course your Agent probably prepared you for this possibility, but after an extended wait time you’ve grown fond of the price you offered and were just waiting for approval to move forward to closing.
In reality, it isn’t a counter because the lender isn’t a principal to the transaction. It is instead a statement of the terms and conditions by which they will agree to release the security for less than what is owed, and they are different than those that you offered.
Changes from the lender can be initiated for a variety of reasons. Sometimes properties are priced low by the listing Agent to generate an offer, but such offers are priced too low to satisfy the bank. What seemed to be too good to be true actually is. The bank won’t agree to let the property sell for such a low price. Yes, it seems ludicrous for them to counter high, lose the Buyer, have to foreclose and get much less for the property later, but that is often what happens. Other things often countered include modifying the closing date, the size of the earnest money deposit, changing who will pay certain closing costs, i.e.- HOA transfer fee, Arms Length Transaction Affidavit requirement, and request for a Seller contribution.
It seems as if the banks are doing more negotiating these days. Sometimes it’s the Negotiator, other times it is the investor pulling strings in the background. Regardless of who decides to counter, offers are being countered with frequency. Sometimes its price, other times it is a settlement from the Seller that they are seeking. We recently had a very strong request from the Investor for cash from a Short Sale Seller. The amount was substantial and very surprising. When the dust settled they did as well, for one fifth of the initial amount requested payable over a 15 year period at zero interest. A great deal for the Seller who could proceed to close with the Short Sale he was seeking, and the lender got something extra they otherwise would not have received.
It is important to realize what you want out of the deal and keep perspective of how the opportunity you are being presented with stacks up in the market. If it is still a good deal, and most likely it is, get over the thought that you lost something and look at what you are gaining.
Our Advice: Keep your eye on your end goal. What will the property you are looking to buy do for you and your family? If you are countered and the terms are still favorable, accept it and buy the home you want. If you can’t live with all the terms, but you can move from your original offer, submit a counter counter offer. Remember, the negotiators have hundreds of files. If they get a few extra thousand from each account that adds up to a significant sum at the end of the year. Give them something and you might get something good in return. If it doesn’t work out… keep moving. You were looking for a home when you found this one. Not all negotiators are reasonable. If they won’t negotiate in good faith then let them foreclose and get the home.
Don’t be afraid to negotiate. That is what the bank is doing, and you should as well. Yes, it will add time to your purchase, but a little time can result in you getting what you want on terms you want. You don’t want it on terms you don’t want in which case you won’t get it. One thing is for certain – if you don’t ask you won’t know if they will accept your terms.
When it comes to choosing professionals to assist you with your real estate needs ... Experience is Priceless! Lisa Wetzel and Jim Valentine, CDPE, SFR, RE/MAX Realty Affiliates, 775-781-5472 firstname.lastname@example.org, www.carsonvalleyland.com
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