Cash Buyer - Short Sale - Can Close Quickly - Who Cares?

By
Real Estate Broker/Owner with Realty Works Temecula BRE No: 01233850

Buyer's that offer cash on short sales and think that it's a bargaining tool, that they can "close quickly", are not informed as to what the short sale process really entails!  In fact if a buyer has the attitude, "Accept My Cash-Quick-Close-Offer, Or Else", it can make the seller's agent refuse the offer as they want a buyer who is going to wait and be patient for the property to go through the short sale process.  Bank negotiates are not going to move any more quickly for a short sale but many buyers still want to try this tactic.  

Negotiating is all about who has the power and in a short sale neither the seller or the buyer has the power.   The bank negotiate has all of the power, the power to approve the short sale or foreclose on the buyer!  The seller, who is on title, signs the offer for a short sale, but all short sales are "Subject To", bank approval.  It's a waiting game and banks are not willing to take a sales amount that is less than, "Appraised Value", even on a cash offer that can "Close Quickly"!

Banks will have their own real estate professionals perform a Broker Price Opinion, based on recent sold comparables and they will only negotiate if the buyer comes up with repairs, actual cost estimates that can be deduced from the Broker Price Opinion, value.  

It's not the negotiating skills of the buyer's agent that will help a short sale offer get accepted, because the bank is looking only at their bottom line, and if they don't get it they will simply foreclose on the seller and the home will become a Bank Owned Home!

 

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Southwest Real Estate, Inc.
Telephone: 866 621-0155

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Rainer
187,236
Kristal Wilson
Keller Williams Costal Properties - Long Beach, CA
Making your real estate transaction kristal clear!

Jane ~  Often, if all things are equal, I recommend my sellers select the offer which indicates the buyer is ready to be patient & understands the process. (We are including an addendum which outlines the process.) Hopefully agents representing the cash buyers are educating their clients to your points.

Jun 05, 2011 02:52 PM #1
Rainmaker
599,136
Donne Knudsen
Los Angeles & Ventura Counties in CA - Simi Valley, CA
CalState Realty Services

Jane - I'm so sick of the all cash buyers attitudes and I don't even work with them either.  The problem with the all cash buyers is that their arrogant and ego manacle attitudes are fed by the REO banks who continue to feed them with acceptance of their ridiculous lowball offers.  At least that's the case around here.

Jun 05, 2011 05:44 PM #2
Anonymous
Anonymous

I read a story in the paper this morning about all sorts of fraud going on with investors, real estate agents, and short sales. Didn't portray the industry in a very good light.

Jun 05, 2011 06:19 PM #3
Rainmaker
659,720
Realty Works Temecula
Realty Works Temecula - Temecula, CA
Real Estate, Temecula, Murrieta, Menifee

Kristal:  I wrote this blog as continuing education for cash buyers.   They still seem to believe that closing quickly will land them acceptance with a short sale offer?

Donne:  I do work with them but it can be difficult to educate them about our market especially with the National news painting our economy and real estate market as a disaster.  I think the disasters in the other parts of the U.S., like the floods, hurricanes are pulling NATIONAL averages down, but we have none of those disasters and this is our busy season, so low ball offers are not being accepted.  Only offers that are in line with recent sold comparables are.   A buyer actually told me that he is making a low offer due to the "Future Declining Market".

And Donne you are right about the REO's they WILL take lower cash offers...so if a buyer wants to make low offers then do it on REO's NOT short sales!

Eric:  Unfortunately fraud has always been a part of the Real Estate Market...this is why Broker's have to watch over every transaction and are licensed...but there are bad Real Estate Professionals out there as there are in every industry!

Jun 05, 2011 07:20 PM #4
Ambassador
403,537
Terrie Leighton
Ferrari-Lund ~ Reno's Premier Real Estate Company - Reno, NV
Reno Real Estate Agent ~ Selling Homes in Reno

So true Jane ~ I don't think anyone on the lien holders end cares what type of offer comes in until the negotiator is ready to work on the file. So offering cash does not move things along quicker. I wish it did but it simply does not.

Jun 06, 2011 09:45 AM #5
Rainer
4,219
Julian Hart
First National Realty, Inc. - Memphis, TN

Thanks Jane! I learned alot reading this. Keep it coming.

Jun 06, 2011 03:54 PM #6
Rainmaker
1,109,103
Jim Frimmer
HomeSmart Realty West - San Diego, CA
Realtor & CDPE, Mission Valley specialist

Cash is still king in some circumstances but I don’t think one of those circumstances is a short sale!

Jun 08, 2011 11:41 PM #7
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Rainmaker
659,720

Realty Works Temecula

Real Estate, Temecula, Murrieta, Menifee
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