Thread: Short Sale Question: Why would seller try to get higher bids?

It is possible the listing agent put a listing price on the house lower than market value knowing the bank won't take the low price. Now they are waiting for a higher offer which the bank might accept.

The banks are not taking just whatever offer comes in. They are trying to get market value and if your offer is below market value they won't take it.

I have seen agents list properties really low just to stir up interest.

Has your agent done a CMA for you to determine what the market value is for the house?

My realtor did some research and found the place is priced a little low -- and I guess it makes sense they'd put it low to try to get people to bid up.

I just wasn't really understanding the seller's incentive to this tactic. I understand the lender won't just accept the first offer that comes across their desk -- but it just puzzled me when I offered more than the asking price and the seller and their realtor continue to stall for more offers.

So I guess that makes sense then that the seller's realtor knows the lender won't accept an offer unless it's one amount and they set the asking price lower to encourage offers to bid up to that point?

Thanks for your help!

I've put low asking prices on short sale homes only after marketing the property at market price and reducing. It seems strange that an agent would sit on an offer knowing that time is ticking away and foreclosure is looming.
Just to get the process started you need an offer on the home; otherwise the banks not interested. So it would be in his or her and the sellers best interest to submit the offer just to get a bank negotiator assigned and to stall the forecloser - and that takes awhile.

Are you sure thats what there doing..? Maybe they don't have all the documents needed from the seller ie. bank statements, w2's, hardship letter..etc I would still submit it though.

Best of luck to you!

I actually found out today the seller accepted my offer and we're moving forward to the lender now. It just seemed strange that things were taking awhile in the seller's court and they were being very ambiguous about what was going on.

But, that part of the deal has seemed to work out -- and now on to the lender!

Thanks for the help

In many cases the lender requires that the seller take on the short fall between the sales price and what is owed. The seller may want to see that window be as small as possible.

Originally Posted by msaz87

I actually found out today the seller accepted my offer and we're moving forward to the lender now.

This IS NOT a time to breathe a sigh of relieve... You are not interested in the seller accepting the offer, but the lender. I have had houses GIVEN to me, and after trying to work a deal with their lenders, I have had to give them back, since there was nothing I could do to work the SS.

What makes a good SS offer is proving your case that the lender WOULD LOSE MORE if they didn't take your offer. Lenders don't accept offers, just becuase they were made an offer, it needs to make sense. If the lender feels that they can make more by holding the house, and even to the point of getting it in their inventory (REO) they will do that.

I have seen MANY SS wanna-bes make offers just by pulling a number out of the sky, and they wonder why they can't get offers accepted. There is a science to SS, which many don't understand.

Too bad the subject is too big to educate in here.

Later!

"What makes a good SS offer is proving your case that the lender WOULD LOSE MORE if they didn't take your offer. Lenders don't accept offers, just becuase they were made an offer, it needs to make sense. If the lender feels that they can make more by holding the house, and even to the point of getting it in their inventory (REO) they will do that."

This comment is true and many people fail to realized this and their SS offer end up getting rejected by the bank.