Special offer

Don’t give up if the bank rejects your short sale offer

By
Real Estate Agent

If you think the offer that was submitted is a good one and likely to be the best one the bank will receive, it's your job to convince the bank to accept it.

Most banks will order an appraisal and use that as the basis for their decision. Unfortunately, with the slowdown in sales, some of the comps used in the appraisal may be 9-12 months old and not representative of the current market since they don't typically use active comps.

Provide the bank with an analysis of your local market along with specific information on your short sale's neighborhood. Include MLS market data and graphs to substantiate your reasoning. Discuss the condition of the property and send pictures, copies of inspection reports, list of needed repairs and contractor estimates. Let the bank know how many times the house has been shown, feedback from potential buyers, and number of offers. It might help to include MLS list data for the short sale as well as its comps (sold and active).

This information is normally provided in a BPO and is probably a good idea to include with the short sale package when the offer is submitted in the first place even though the bank doesn't usually ask for it.

I have recently had success in getting approval by submitting this additional information for two short sales whose offers had originally been rejected.

Comments(13)

David M. Childress
Howard Hanna Real Estate Services - Akron, OH
I would love to be your Realtor® in Akron Ohio!

Are you seeing a slow down in short sales answers since the bail out legislation? I wonder if they are waiting for better money.....

Dec 18, 2008 01:02 PM
Patricia Aulson
BERKSHIRE HATHAWAY HOME SERVICES Verani Realty NH Real Estate - Exeter, NH
Realtor - Portsmouth NH Homes-Hampton NH Homes
I have had an offer in for a client of mine for over 5 months......Give me a breat!! Why don't they take the money and run. Cash deal, close in 10 days, take it as it....Gezzzz Patricia Aulson/ Hampton NH Real Estate
Dec 18, 2008 01:20 PM
Brian Brumpton
Keller Williams Boise - Boise, ID
Boise Idaho Real Estate

good information, I've noticed in the last shortsales I've done that some banks are asking for less information, but that doesn't mean that I'm not sending exactly what you are.  I think it helps too.

Dec 18, 2008 01:22 PM
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

You can't give up to quickley.  The banks have been playing this game for a long time now and they just aren't ready to stop yet!

Dec 18, 2008 01:36 PM
Roland Woodworth
Blue Cord Realty - Clarksville, TN
Blue Cord Realty

Colleen.. Great post... One should never give up.. sending pictures will help some time with the current condition of the home.

Dec 18, 2008 03:46 PM
Valerie McNeal, CRS, GRI, CDPE
Keller Williams Integrity Bob Lucido Team - Ellicott City, MD
Integrity, Knowledge, Results

After 3 months, the bank rejected my offer which is all-cash, no contingencies. They sent someone out to do a BPO then countered the offer by $20K. The person doing the BPO did not even enter into the property because they would have seen the how much the house was in need of repair. I sent in photo's of all the mold and water damage and everything else happening in the house and now they are considering the original offer which is a fair offer. Don't give up - the banks do not always do their due diligence.

Dec 18, 2008 09:38 PM
Scott Guay
Berkshire Hathaway Home Services PenFed Realty - Ocean Pines, MD
Associate Broker. Ocean City and Ocean Pines MD

We always hear how educated buyers are these days.  maybe it is time we educated the sellers of these short sales and Bank owned properties.

Dec 18, 2008 10:13 PM
Tucson Real Estate Experts Anne McKechnie
Coldwell Banker Residential Brokerage - Tucson, AZ
Previews Property Specialist

Great info...we have done this too....one of our short sales has been rejected twice, and we finally got an acceptance

Dec 20, 2008 12:00 AM
Jon Wnoroski
America's 1st Choice RH Realty Co., Inc. - Green, OH
Summit County Realtor

Hi Colleen - I had a buyer purchase property at a relatively low price.  This property had an offer a few months before my client made the purchase that was $20,000 higher than what my client paid; however, they rejected it.  Whoever was responsible for making the decision on the first offer cost their institution quite a bit of money.  Sometimes they ought to look realistically at the property they represent and give serious considerations to all offers made.  In this case they knew nothing about the location or the actual value of the property.  My client got a great deal while the seller lost out on a much better deal.

Dec 20, 2008 12:11 AM
Not a real person
San Diego, CA

Going above and beyond what might normally be required can certainly bring excellent results.

I read where the Appraisal Institute is investigating BPO's. I think they have a good case. After all, a rose by any other name is still a rose.

Best wishes for health, happiness, peace, and prosperity in 2009.

Dec 23, 2008 04:03 AM
Sergio Rebollo Jr.
Real Estate TeamMates - Miami, FL

Colleen....good tips.  I've listed several short sales and had a Title Company negotiate for us.  Not too thrilled with it so your tips and boldness will help me as I will do the complete process myself now.

Dec 30, 2008 11:23 AM
Michael Wayne Jackson
Coldwell Banker - Novato, CA
Broker - Seniors Real Estate Specialist Novato

We can't take no for an answer and sometimes the banks are just too stubborn to convince but most of the time they will keep an open mind especially when they hear the best offer is no longer available.

Jan 20, 2009 09:26 AM
Maya Thomas, Broker
Tampa, FL
Please see my client recommendations.

An appraisal is done on recent sales data and a BPO is based on what a broker could sell the property for tomorrow.  If given the choice as a listing agent I want the BPO.  Hopefully the bank asks for interior photos so that you can bring comps to give to the agent.  

Feb 27, 2009 01:31 PM