I usually don't recommend writing offers on short sales that already have an accepted offer under bank review. You could send in an offer, but the offer will often not reach the bank. Usually it is held by the seller until after the bank replies to the first offer. One of the seller's main goals is to get an approved price from the bank. If they send in newer and higher offers every few days, the bank has no incentive to reply or to approve one of the short sale offers in hand. It can also start the process completely over at the bank, further delaying getting an approved price back. Only after the seller gets an approved price figure back from the bank can they sell their home with the removal of the liens.
There is a way to skip needing bank approval. You could offer a price that would pay off the bank in full, thus not needing their approval to sell. The problem with this is that you would in most cases be paying more than you should for the home.
A common strategy is to list short sale homes well below what the bank is likely to accept for the sole purpose of undercutting the market to get a contract with a buyer. Many banks will not even begin exploring what they will accept as a short sale price without having a signed contract with a real buyer.
Many sellers quit showing their home once they have an accepted contract to the bank. Can you imagine the daily traffic they must receive by listing their home so far under market value? The sheer number of people coming through the home is a nuisance to the seller or tenant living in the home, and just adds further wear and tear to the property. Why endure that when they already have what they were after? (A contract to be able to start the short sale process at the bank.)
There are few possible outcomes when a short sale offer is under bank review:
1. The bank accepts the short sale offer they received, in which case, you didn't get a chance.
2. The bank rejects the short sale offer, but approves some other sales price. If this happens, you'll get a shot to submit an offer. (Presuming your agent has you set up on a system that will notify you of status changes of properties that match your search criteria.)
3. The bank never responds to the short sale offer. You'll either have saved a lot of time by not getting tangled up in the mess, or if you are really patient, you may get a chance to bid on the home eventually if the bank pursues foreclosure.
My recommendation is generally to pursue short sales where the bank has already approved a price. The previous buyer either got tired of waiting for the bank's response and walked, or the bank's approved price was more than that buyer wanted to pay. In either case, at least you'll know what the bank was willing to take for the home and can determine if that figure is above or below the market value of the home.
"Short Sale" does not automatically equate to "a good deal".
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