One of the most confusing and frustrating types of real estate sales is the short sale transaction. Having helped owners that have a financial hardship and negative equity sell their home and also assisted buyers in the purchase of short sales, I felt it would be beneficial to highlight some different facets of Phoenix area short sales. Here are two simple facts that will help a buyer become more prepared and successful when considering a waterfront short sale or any type of short sale purchase.
Especially when the property is first put on the market, the list price is an arbitrary number the Realtor has chosen. The listed sales price will continue to be reduced until an offer is received and accepted by the owner. Then the short sale package along with the offer goes to the bank … and the wait begins. It is very common that when no offer at the listed price, you’ll see periodic price reductions until a buyer says, “Wow, what a deal” and submits an offer. When an offer on a short sale property has been submitted and the bank responded but the buyer is long gone, the property will be relisted and now there is better understanding of what the bank will accept.
I must point out that Wachovia Bank is getting way ahead of the curve. Believe it or not, in the Phoenix area the Wachovia short sale negotiator will start the process once the home is listed. The negotiator will meet with the seller, qualify them regarding their hardship, and close in 45 days after receiving an acceptable offer. Hopefully other banks will follow. If you have a Wachovia loan and need to sell, please call me for details on this great program.
Buyers and their agent should sit down and carefully review the comparable sales in the neighborhood for similar houses. Nothing is more dangerous than a “type A” personality person seeing an aggresively priced below market short sale and then settling for nothing less than submitting a low ball offer 20% offer below the listed price. Why? Because the lender will do their own market analysis through a BPO (Broker Price Opinion) or appraisal. They don’t really care what the list price is, they didn’t set it. Once they have determined the market value, they will decide how much of a discount they are willing to accept and that will drive the counter offer to the buyer that has been waiting for 3 months. If the buyer did their homework and understood that they are likely to receive a 10% discount below market value and are prepared for that price in a counter offer, you are more prepared than most buyers and may endure the Phoenix short sale process.
Phoenix Waterfront Short Sale Searches:
For more details on the intriguing part of the market called short sales, please call me at 480-326-8571 for more stories information.
Other posts about short sales in Gilbert, Chandler, and the Phoenix area