Okay, this will surely strike some nerves with those buyers out there trying to purchase a short sale home. Sorry, but the facts are what they are.
First let me say that I've done many Short Sales, representing both the seller and the buyer, and therefore have some insight into the process and situation.
I'll say it now, and again.... SHORT SALES ARE ALL ABOUT THE SELLER.
Let's break it down. The reason why the short sale is all about the seller is simple. The seller in most cases is in trouble and needs to get out of the financial situation. The seller has requested the lien holders to approve a short sale (for those who have not heard of a short sale - simply put - it's when a property is sold for less than what is owed).
The lien holders are not OBLIGATED to approve a short sale for the seller. As we have seen over the last several years, not all short sales are approved. A good majority of them are, but ultimately the lien holders have the final say. Sadly, we have no control over this.
Now the buyer steps in....places an offer on a property, expecting a great deal and then expects everyone to complete the sale. It seems that there are still too many buyer agents out there who have not educated their buyer's. Again, let me say SHORT SALES ARE ALL ABOUT THE SELLER. If the lien holder and the seller cannot come to an agreement regarding the terms of the short sale, the seller has EVERY right to cancel the sale. The buyer cannot force a seller to perform at that point. This is not normal real estate sales, and the sooner that buyers are educated, the better.
SHORT SALES ARE ALL ABOUT THE SELLER
In the state of Arizona, we have a SHORT SALE ADDENDUM document that is required to be signed by both seller and buyer. It clearly states that a seller can cancel if the seller and lien holders cannot come to agreement on the sale. Where does it say that a seller must continue? No where ! Yet buyers for some reason think they are owed the opportunity to purchase the property.
Many of us know what it's like to have a short sale listing with a buyer offer (remember it is just an offer) and the buyer decides to cancel after 60-90 days of work and effort have gone into the transaction. Frustrating.....you bet. Now turn the tables and we have a situation where a seller has attempted a Short Sale. The lien holder has done there due diligence and determined that they will not approve the short sale for whatever reason. At this time the seller has no choice but to cancel the short sale offer with the buyer.
So let me ask you....why would the buyer want to continue? Perhaps they were still trying to meet the $8000 homebuyer tax credit deadlines. Or it's truly their dream home and can't live without it.
Since the lien holder has denied the short sale, what possible control does the buyer have? Again.... SHORT SALES ARE ALL ABOUT THE SELLER. The buyer has no control and cannot force the seller to perform. The offer was not accepted by the lien holder. The buyer should move on to another purchase (and yes there are plenty of great homes out there).
As I work with buyers I make sure that I repeat over and over again to them.....there is no guarantee on a Short Sale. If the buyer has deadlines to meet, perhaps an REO or regular sale is in the best interest. Short Sales are not for all Buyers, regardless how great a deal they could possibly get.
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