Ladera short sale denial - Bank wants closer to 'market value'

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oc_35_IHB

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Just saw a very funny remark in the agent section of a listing in Ladera. Below is the link to the listing on redfin:



http://www.redfin.com/CA/Ladera-Ranch/27-Merrill-Hl-92694/home/12316827



Agent remarks: Sales price already approved TWICE... first at $985K, then $950K.... educate your buyers!!! Property is GORGEOUS and EASY to show!(If bank reduces commission.... split to be 50/50... sale and commission subject to bank approval... 50/50 split if reduced. <span style="font-size: 13px;"><span style="color: red;"><em><strong>$850K turned down by bank: they want to get 'closer to market value'.... of $950000</strong></em></span></span>... SUBMIT, SUBMIT!



I guess the bank can't read numbers since the property has been on the market for 409 days. Good luck with that.
 
[quote author="oc_35" date=1229646130]Just saw a very funny remark in the agent section of a listing in Ladera. Below is the link to the listing on redfin:



http://www.redfin.com/CA/Ladera-Ranch/27-Merrill-Hl-92694/home/12316827



Agent remarks: Sales price already approved TWICE... first at $985K, then $950K.... educate your buyers!!! Property is GORGEOUS and EASY to show!(If bank reduces commission.... split to be 50/50... sale and commission subject to bank approval... 50/50 split if reduced. <span style="font-size: 13px;"><span style="color: red;"><em><strong>$850K turned down by bank: they want to get 'closer to market value'.... of $950000</strong></em></span></span>... SUBMIT, SUBMIT!



I guess the bank can't read numbers since the property has been on the market for 409 days. Good luck with that.</blockquote>


It can sit there and rot.
 
Were those comments made recently or a few months ago?



It appears the price changed to 850,000 in Oct. then now changed UP to 875,000



I'm curious if those comments were made when the listed price was at 850,000 or when it was at 950k in August/Sept/early October.



That'd be interesting if someone offered them list at 850k and they turned it down!
 
[quote author="24inIrvine" date=1229649433]Were those comments made recently or a few months ago?



It appears the price changed to 850,000 in Oct. then now changed UP to 875,000



I'm curious if those comments were made when the listed price was at 850,000 or when it was at 950k in August/Sept/early October.



That'd be interesting if someone offered them list at 850k and they turned it down!</blockquote>


I would guess that an offer was made recently at list when the list price was $850k and it was denied so they then upped list to $875k. I know people are crazy but it would be absolutely insane to raise a price in Ladera at the moment without cause.
 
So maybe the conversation went something like this:



Realtor: Okay, my client is submitting an offer at your list price of 850,000

Bank: Denied! Why would they offer that?

Realtor: Because that is what you listed it for. My client feels that is a fair price

Bank: No no no, we want 950k! That is closer to fair market value

Realtor: So why did you list at 850k?

Bank: You are right, we should raise the list price to 875k. Then they will submit offers of 950k!

Realtor: I don't think that will work.

Bank : Then educate your buyers! Property is gorgeous and easy to show! Submit Submit!!
 
[quote author="24inIrvine" date=1229652263]So maybe the conversation went something like this:



Realtor: Okay, my client is submitting an offer at your list price of 850,000

Bank: Denied! Why would they offer that?

Realtor: Because that is what you listed it for. My client feels that is a fair price

Bank: No no no, we want 950k! That is closer to fair market value

Realtor: So why did you list at 850k?

Bank: You are right, we should raise the list price to 875k. Then they will submit offers of 950k!

Realtor: I don't think that will work.

Bank : Then educate your buyers! Property is gorgeous and easy to show! Submit Submit!!</blockquote>


To clarify - on a short sale, <strong>bank has no say in the list price</strong>. It is entirely fabricated by the realtor.

The conversation goes more like this:



<em>Homeowner: We can't afford our payments any longer.

Realtor: Your home's market value is less than what you owe. We have to get the bank/s to approve a short sale.

Bank: We're not doing anything without an offer.

Realtor (to homeowner): I can list it for market value and hope for an offer, or list for 20% below market and definitely get an offer.

Homeowner: Doesn't matter to me. I'm outta here and the bank is taking the loss.

Realtor (to homeowner): 20% below it is!

Realtor (to bank): Here's your offer.

Bank (3 weeks later): OK, we'll send the appraiser out to verify value. Hey! Everyone else is getting $950K for this home. We'll approve at that level.

Realtor: Why didn't you tell me that before?

Bank: Why did you list it at that ridiculous price?

Realtor: You don't do anything without an offer.

Bank: >:( </em>



Until this policy changes, expect more of the same....
 
THanks IR2, so what eneds up happening? No offers come at that 950k that they say everyone else is getting and it just sits and sits?



If thats the case, where is the bank getting the idea that everyone else is getting 950k? Are they using outdated numbers from like 2006 or 2007?
 
[quote author="24inIrvine" date=1229656744]THanks IR2, so what eneds up happening? No offers come at that 950k that they say everyone else is getting and it just sits and sits?



If thats the case, where is the bank getting the idea that everyone else is getting 950k? Are they using outdated numbers from like 2006 or 2007?</blockquote>


I highly doubt this house is worth more than $850k anyway based on recent closed sales.
 
[quote author="24inIrvine" date=1229656744]THanks IR2, so what eneds up happening? No offers come at that 950k that they say everyone else is getting and it just sits and sits?



If thats the case, where is the bank getting the idea that everyone else is getting 950k? Are they using outdated numbers from like 2006 or 2007?</blockquote>


Have you ever made pancakes? You know how that first round fails to get a good browning, but the next round is fine as the pan has reseasoned and has the proper amount of oil? It's a little like that. Consider the first offer like the first pancake. It is needed to get the dialogue opened. After that, the process can be relatively easy if you have one lender and a realistic appraisal, or very difficult one with multiple lenders who each have to agree not only to the total (fair) price but also the split... seconds and thirds are less likely to agree to get their entire stake be wiped out. Also remember that the first requirement of a short sale is the seller's inability to pay and proof of hardship. The lenders will do their best to squeeze what they can out of the homeowner and investigate their finances. All of this takes time, which gives the potential buyer time to walk (or a new buyer to bid).



Hope this helps.

-IR2
 
[quote author="IrvineRealtor" date=1229658685][quote author="24inIrvine" date=1229656744]THanks IR2, so what eneds up happening? No offers come at that 950k that they say everyone else is getting and it just sits and sits?



If thats the case, where is the bank getting the idea that everyone else is getting 950k? Are they using outdated numbers from like 2006 or 2007?</blockquote>


Have you ever made pancakes? You know how that first round fails to get a good browning, but the next round is fine as the pan has reseasoned and has the proper amount of oil? It's a little like that. Consider the first offer like the first pancake. It is needed to get the dialogue opened. After that, the process can be relatively easy if you have one lender and a realistic appraisal, or very difficult one with multiple lenders who each have to agree not only to the total (fair) price but also the split... seconds and thirds are less likely to agree to get their entire stake be wiped out. Also remember that the first requirement of a short sale is the seller's inability to pay and proof of hardship. The lenders will do their best to squeeze what they can out of the homeowner and investigate their finances. All of this takes time, which gives the potential buyer time to walk (or a new buyer to bid).



Hope this helps.

-IR2</blockquote>


So ... if I read you right, if I want to purchase a short sale, I should have a friend make a ridiculous offer first. After the ridiculous offer gets refused, I make a slightly less ridiculous offer?
 
[quote author="awgee" date=1229664576][quote author="IrvineRealtor" date=1229658685][quote author="24inIrvine" date=1229656744]THanks IR2, so what eneds up happening? No offers come at that 950k that they say everyone else is getting and it just sits and sits?



If thats the case, where is the bank getting the idea that everyone else is getting 950k? Are they using outdated numbers from like 2006 or 2007?</blockquote>


Have you ever made pancakes? You know how that first round fails to get a good browning, but the next round is fine as the pan has reseasoned and has the proper amount of oil? It's a little like that. Consider the first offer like the first pancake. It is needed to get the dialogue opened. After that, the process can be relatively easy if you have one lender and a realistic appraisal, or very difficult one with multiple lenders who each have to agree not only to the total (fair) price but also the split... seconds and thirds are less likely to agree to get their entire stake be wiped out. Also remember that the first requirement of a short sale is the seller's inability to pay and proof of hardship. The lenders will do their best to squeeze what they can out of the homeowner and investigate their finances. All of this takes time, which gives the potential buyer time to walk (or a new buyer to bid).



Hope this helps.

-IR2</blockquote>


So ... if I read you right, if I want to purchase a short sale, I should have a friend make a ridiculous offer first. After the ridiculous offer gets refused, I make a slightly less ridiculous offer?</blockquote>


In the immortal words of irvine_(former)_home_owner - "These are not the droids you are looking for..."
 
[quote author="oc_35" date=1229646130]Just saw a very funny remark in the agent section of a listing in Ladera. Below is the link to the listing on redfin:



http://www.redfin.com/CA/Ladera-Ranch/27-Merrill-Hl-92694/home/12316827



Agent remarks: Sales price already approved TWICE... first at $985K, then $950K.... educate your buyers!!! Property is GORGEOUS and EASY to show!(If bank reduces commission.... split to be 50/50... sale and commission subject to bank approval... 50/50 split if reduced. <span style="font-size: 13px;"><span style="color: red;"><em><strong>$850K turned down by bank: they want to get 'closer to market value'.... of $950000</strong></em></span></span>... SUBMIT, SUBMIT!



I guess the bank can't read numbers since the property has been on the market for 409 days. Good luck with that.</blockquote>


Ahhhh, Lazy agent does not want to do their job and submit all offers. Real Estate is to hard and i have to waste a lot of time with an insolvent bank who can not take the write off on their books at this time with all these low-ball offers. Wahhh, agent wants to steer people on price (Educate your buyers!!! What a tool...) as agent knows better (Cough,"BS"). Agent looking for knife catcher to please buy on agents terms to gets paid quickly because of desperation and inexperience and agent does not realize bank does not give a flying rats ass about this agent. If the glove fits you got to quit!!!
 
[quote author="IrvineRealtor" date=1229667118][quote author="awgee" date=1229664576][quote author="IrvineRealtor" date=1229658685][quote author="24inIrvine" date=1229656744]THanks IR2, so what eneds up happening? No offers come at that 950k that they say everyone else is getting and it just sits and sits?



If thats the case, where is the bank getting the idea that everyone else is getting 950k? Are they using outdated numbers from like 2006 or 2007?</blockquote>


Have you ever made pancakes? You know how that first round fails to get a good browning, but the next round is fine as the pan has reseasoned and has the proper amount of oil? It's a little like that. Consider the first offer like the first pancake. It is needed to get the dialogue opened. After that, the process can be relatively easy if you have one lender and a realistic appraisal, or very difficult one with multiple lenders who each have to agree not only to the total (fair) price but also the split... seconds and thirds are less likely to agree to get their entire stake be wiped out. Also remember that the first requirement of a short sale is the seller's inability to pay and proof of hardship. The lenders will do their best to squeeze what they can out of the homeowner and investigate their finances. All of this takes time, which gives the potential buyer time to walk (or a new buyer to bid).



Hope this helps.

-IR2</blockquote>


So ... if I read you right, if I want to purchase a short sale, I should have a friend make a ridiculous offer first. After the ridiculous offer gets refused, I make a slightly less ridiculous offer?</blockquote>


In the immortal words of irvine_(former)_home_owner - "These are not the droids you are looking for..."</blockquote>
I don gid it.
 
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