How to Write A Short Sale Offer In A Competitive Market

By
Real Estate Broker/Owner with Mint Properties, Lic. #01871795 Lic. #01871795

How to Write A Short Sale Offer In A Competitive Market

 

The local real estate market in Santa Maria and Orcutt California is currently dominated by bidding wars and multiple offer situations.  So, no matter what type of listing it is (REO, short sale or traditional), the one certainty is competition.  As a local short sale agent, I am amazed at the offers I see that just will not fly in this environment.  Although short sale sellers generally do not receive proceeds from the sale (unless they are lender approved incentive payments), their needs and desires should be considered when writing a short sale offer, especially if you want to gain their acceptance of your offer in a low inventory market.

 

Here are a few tips:

 

    Don’t ask for the seller’s personal belongings.  I’ve seen this time and time again.  Hands off the seller’s personal belongings!  Unless it is offered in the listing sheet (and maybe not even then), do not ask for a short sale seller’s refrigerator, washer, dryer, or couch.  Short sale sellers are usually in financial distress, most don’t welcome also having to replace appliances and furniture when they move.

 

    Offer to put your initial deposit in escrow.  This shows commitment to the deal, and that you are probably not one of those buyers who is constantly shopping around while the seller is applying for short sale approval.  Losing a buyer is one of the typical reasons why short sales drag on and on and if the foreclosure time clock has begun it can also cause the seller to lose the property through foreclosure.  Assure the seller that you are committed to the deal by showing them the money.

 

    Do your home inspection up front.  Most short sale sellers are looking to sell their home “as is” because they do not have the funds to make repairs.  Of course, buyers are encouraged to carefully review disclosures and perform a home inspection so they can determine what “as is” is.  By offering to do your home inspection up front, the seller is assured that you are committed to the deal and that they are not going to be hit with last minute repair requests after the short sale approval has been issued. 

 

    Write a clean offer.  Clean offers are easier to get approved by the short sale lender.  Offers that do not ask the seller to pay closing costs, termite repairs, or purchase home warranty policies are generally considered “cleaner” than offers that request those concessions.  If the market is competitive, consider leaving out the extras that you would like to have but are not likely to get.  Don’t assume that you will receive a counter offer in a competitive market.

    Offer a timeline that works for the seller.  If the home is still occupied by the seller, have your real estate agent ask the listing agent about the seller’s plans.  If they are still figuring it all out, they may want to wait for the regular contract period to begin.  If they are mostly concerned about minimizing damage to their credit and an upcoming inability to pay, they may prefer that you begin the regular contract period now and be ready to close when the short sale approval(s) arrive.  Find out what that particular short sale seller wants in terms of a timeline and offer it to them.

 

If you are interested in purchasing a short sale home in the competitive Santa Maria and Orcutt real estate market, it may help to work with an agent who has short sale experience.  Understanding the short sale process and the dynamics at play for short sale sellers, can be essential when making short sale offers in this competitive market. 

 

Those considering a short sale of their property should obtain legal and tax advice, and also consult with an experienced local short sale agent.  If you are considering a short sale of your Santa Maria, Orcutt, or Nipomo home and would like a no cost short sale consultation, please call my office to schedule a meeting or a telephone consultation at (805) 938-9950.

TniLeBlanc is an independent Real Estate Broker, Attorney, and Short Sale Agent.  She is a  Certified Distressed Property Expert (CDPE), Short Sale and Foreclosure Resource(SFR), and Certified HAFA Specialist (CHS) serving the Santa Maria, Orcutt and Five Cities area of the Central Coast of California.


* Nothing in this article is intended to solicit listings currently under contract with another broker. This article offers no legal or tax advice. Those considering a short sale are advised to consult with their own attorney for legal advice, and their tax professional for tax advice prior to entering into a short sale listing agreement. Any and all program benefits described are subject to change.

 

Copyright© 2012 Tni LeBlanc *How to Write A Short Sale Offer In A Competitive Market*

 

Posted by

Tni LeBlanc, Broker
(805) 878-9879 mobile/text

tni@mintprop.com
www.MintProp.com
CalBRE #01871795

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Re-Blogged 4 times:

Re-Blogged By Re-Blogged At
  1. Kay Van Kampen 04/23/2012 12:32 PM
  2. Gene Riemenschneider 04/29/2012 02:48 PM
  3. Elva Branson-Lee 05/05/2012 10:53 AM
  4. Gabe Sanders 05/06/2012 08:47 PM
Topic:
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Short Sale REALTORS®
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Rainmaker
686,759
Hella Mitschke Rothwell
(831) 626-4000 - Honolulu, HI
Hawaii & California Real Estate Broker

Tni: Great blog. As a short sale listing broker, I found it really helps to go into escrow and have them issue a preliminary HUD-1 to include with the package that has all disclosures signed by everyone in it. I get my approvals fast and, in fact, the lender pressures for an early closing.

Apr 23, 2012 12:45 PM #18
Rainmaker
1,317,551
Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services

Lenn took the words right out of  my mouth.  I hope that things will start to improve so that more short sales are "short". 

Apr 23, 2012 12:58 PM #19
Rainmaker
809,919
Evelyn Kennedy
Alain Pinel Realtors - Alameda, CA
Alameda, Real Estate, Alameda, CA

Tni:

The market is changing and buyers need to change their tactics with the changing market.  Having an experienced short sale agent is key to closing the sale successfully.

Apr 23, 2012 02:07 PM #20
Ambassador
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Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 714-319-9751 DRE01267479 - Costa M

Tni - It's obvious you have been to the short sale rodeo a time or fifty.

Apr 23, 2012 04:06 PM #21
Rainmaker
300,386
Marti Steele Kilby, CRS
Steele Group Realty - La Mesa, CA
Broker/Owner, San Diego, CA

Tri...love it!  You hit all my pet peeves!  I always ask for, or offer, deposit in escrow right away, and hands-off personal belongings, unless offered.  As a side note, including personal belonging in the contract may also have to be eliminated by addendum if the buyer's lender has a problem with it. 

Apr 23, 2012 04:12 PM #22
Rainmaker
300,386
Marti Steele Kilby, CRS
Steele Group Realty - La Mesa, CA
Broker/Owner, San Diego, CA

OK.  My bad typo on your name!  Sorry Tni ;)

Apr 23, 2012 04:13 PM #23
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Bob Crane
Woodland Management Service / Woodland Real Estate, Keller Williams Fox Cities - Stevens Point, WI
Forestland Experts! 715-204-9671

Thank you Tni, Great advice and well written, you did a good job of considering the sellers needs and situation in this valuable advice.

Apr 23, 2012 04:44 PM #24
Rainmaker
565,466
Jordon Wheeler
The Jordon Wheeler Group - Fairburn, GA
J W Group Real Estate Sales and Service

Good morning Tni,

Very good post on short sales though sometimes the appliances were part of the original purchase and should stay with the property.  Best of success to you this year!

Apr 23, 2012 08:08 PM #25
Rainmaker
4,432,217
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel

I will bookmark this post and use the tips . Thanks for sharing.

Apr 23, 2012 08:49 PM #26
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Chris Ann Cleland
Long and Foster REALTORS®, Gainesville, VA - Bristow, VA
Associate Broker, Bristow, VA

Depositing the earnest money up front is such an easy way to let the sellers know you aren't jacking them around and looking at other homes to buy.

Apr 23, 2012 11:54 PM #27
Rainmaker
637,816
Don Sabinske
Don Sabinske, Sabinske & Associates Inc. - Zimmerman, MN
Sabinske & Associates Inc.

Yes, yes, yes.  Although I prefer on the list side not to  get the earnest money until the deal is ready.

Apr 24, 2012 12:20 AM #28
Rainmaker
124,387
Harley Wilcox
West Group Real Estate - Victor, ID
Harley Wilcox

Keeping it simple is good! It amazes me when a buyer wants the seller or third party creditor to pay for repairs even after they have been counseled that the home is "as is where is" and the inspection is just for information to help them decide if they want to do the repairs.

Apr 24, 2012 12:49 AM #29
Rainmaker
161,892
Satar Naghshineh
Satar - Amiri Property and Financial Services Corp. - Irvine, CA

I find having the buyers talk to the sellers directly gets their short sale offer accepted in a competitve market.

Apr 24, 2012 03:28 PM #30
Rainmaker
262,323
Kim & Kristine Halverson
Compass - Santa Monica, CA
Sisters, Realtors

Hi Tni,I can't help but to adore this blog.Really good choice of blog and excellent tips.What can I say you're definitely an Amazing Santa Maria Short Sale Agent.Hope to read some more blogs.God Bless!
 

Apr 25, 2012 06:26 AM #31
Ambassador
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Katerina Gasset
Get It Done For Me Virtual Services - Wellington, FL
Get It Done For Me Virtual Services

What a Great tips here Tni,You're definitely one Brilliant Santa Maria Short Sale Agent.You really know how to share your knowledge to other people.Keep it up!
 

Apr 26, 2012 05:04 AM #32
Rainmaker
1,431,210
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

Great post.  Price matters less than all these other issues.  Of course the better the price the more likely the bank is to accept the offer.

Apr 29, 2012 02:34 PM #33
Rainmaker
3,254,755
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

We have our own Short Sale addendum....legally approved of course...inspection and earnest money are due from the Sellers' approval not the Lender's.....if property condition is an issue...best to know right up front...and very very few buyers walk with "skin in the game."

May 06, 2012 08:53 PM #34
Rainer
83,335
Jayne Clement
Keller Williams Realty - Los Feliz, CA
Los Angeles Short Sale Agents

Hello Tni,this is a brilliant suggestion.Alot of markets are getting more competitive.Great job in giving advice to everyone.Continue being the best Santa Maria Short Sale Agent. 



May 09, 2012 11:29 PM #35
Rainmaker
262,323
Kim & Kristine Halverson
Compass - Santa Monica, CA
Sisters, Realtors

Tni,what an excellent topic here.I agree with all their comments.This is one helpful tips to help everyone.Great job.Continue being a great example to everyone and stay the best Santa Maria Short Sale Agent.

May 11, 2012 02:41 AM #36
Rainmaker
709,157
Petra Norris
Lakeland Real Estate Group, Inc. - Lakeland, FL
Realtor, Lakeland FL Homes for Sale

Hi Tni,I will definitely recommend this blog to my other friends I'm sure they would love this.Thanks for this amazing post! Best wishes to you and Keep it up being top notch Santa Maria Short Sale Agent.

 

May 18, 2012 03:01 AM #37
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Tni LeBlanc, Realtor®, J.D.

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