Thread: Can there be multiple offers made on short sale?

[QUOTE=Archeroni;88136]Hi. Potential buyer here.

He quit making payments and is being foreclosed on.

...put a sign in the yard and has shown the property to several people ( I live next door so I know for sure lots of other potential buyers have been looking at the house). -No, people are looking at the house being nosy. 99% of them aren't potentials. Some are even scoping the place out, waiting for the guy to leave his house.

Question - Can the Realtor continue to submit offers to the bank while mine is being considered? -Yes. The bank wants many offers.

If an offer comes in higher than mine will mine be dismissed? -Not necessarily. It depends if you offered cash, how much lower than asking was it for or if you have to qualify for a mortgage and how much patience the Asset Manager has and how much patience their bosses have. In today's market, the banks will sit on properties for a long time.

This does not seem right to me if so. -Why not? The bank is waiting for the highest and best offer. If that takes another year (because you said the seller resigned the listing agreement), then it'll take another year. You're not understanding the banks are in control.

The homeowner, who previously would answer my calls, has not returned my last two calls. I am going to ask him if he has accepted other offers after mine if he ever responds. The situation is starting to chap my hide. -Why? And if his house is going into foreclosure or his lender agreed (once again) to a short sale, your neighbor wouldn't be the one to accept the "other" offers anyway.

Originally Posted by Archeroni

The situation is starting to chap my hide.

At least you don't have to work with these *&^$%&^ short sale deals to make a living.

The majority of short sales never close so we end up continually spinning our wheels.

I don't understand why sellers go through the short sale process. They gain nothing form the deal beside monumental headaches. Agents will tell the sellers they can save their credit but the reality is short sales will only occur if the seller is behind on their mortgage payments and if they are behind on the mortgage payments then their credit is already ruined the same as it would be with a foreclosure.

The smartest thing your neighbor could do would be to just let the house go to foreclosure.

Keep your cash ready because the odds are the house will show up as a forclosure where you can buy it in a normal process.

Edited out this content.

"Like I said this home was on its way to the sheriff's sale had I not approached the owner with a cash, as-is offer." No sir you didn't. You said: "He quit making payments and is being foreclosed on"-This property is not on its way to a Sheriff's sale.

And: "I met with the Realtor and made a cash offer several weeks ago." -I didn't ask you (above), if you made the owner a cash offer. Since you just said you submitted the offer with HIS Realtor.

ONLY the bank knows how many offers have been submitted and how long they're going to hold onto the property before weighing their options and deciding who submitted the highest and best either for cash or for buyers who have to qualify or both. Cash is king though and banks are notorious for taking all cash offers even for substantially less than asking. Can't say I blame them.

His Realtor wouldn't know how many offers came in. The bank isn't going to tell his Realtor or anyone for that matter. Since you said your neighbor re-engaged the services of his Realtor all information and offers are between his agent and other agents. His Realtor is under no obligation to tell you (just another guy who made an offer) anything. He's not being dishonest or lying to you; he's working in a fiduciary capacity to his client.

If you made an offer contingent on your qualifying for a mortgage, depending on your offer, down payment, how long you gave the bank to accept or decline your offer, will determine if your offer is rejected and how quickly.

Edited out this content.

How can this be? -Very simple sir. Because the lender/bank/mortgagee owns the house until the Note is paid in full.

The seller is still the Owner, wouldn't any offers need to be accepted by him FIRST then approved by the bank? -No sir. The seller isn't the owner, that's firstly. See above. Secondly, since the bank holds the Note (control of property), THEY decide what offers they'll accept and when and how long THEIR property (NOT the seller), will remain on the market until it's either sold or goes to auction.

The Owner could win Powerball this week and pay off his mortgage before judgement. How could the bank explain they sold a property that wasn't foreclosed on yet? -Very simple. Firstly, the bank owns the property until the note is paid in full. The bank therefore doesn't need to explain anything. Secondly, you said that the bank approved a Short Sale right? Well, Short Sales means the bank approved taking the house back now from the "seller" for less than what he paid. This puts the bank in control of the property even more so now. So now the bank has his house re-listed with his Realtor again as a Short Sale. Until the bank is satisfied with their offers, will they approve ones offer, maybe yours, maybe someone else's. This process of approving an offer and going back and forth and back and forth with the winning offer, can take up to ten months. If the house is being foreclosed on, this simply means, in time, the bank will have full control to either list it with a Realtor of their own (or your neighbor's), let it sit there and rot or send it directly to the auctioneer.

So you see, once a "seller" goes to the bank to either get a Short Sale approved by their lender or the "seller" is going into foreclosure, they technically are relinquishing all rights to the property. The offers the bank gets are in no way anyone's business. Not the "seller", not the Realtor, not anyone who made an offer. It's confidential information sir. All the bank has to do is get back to the Realtor with with either a Yea or Nay. That's all.

Now, if you verbally offered your neighbor cash, through his Realtor, well, since this is what it sounds like you did, I wouldn't be expecting an answer from the Realtor (the bank talking to them and not you directly), any time soon. Verbal offers really aren't any good sir. Who knows even if your neighbor's Realtor said anything to the bank regarding your verbal offer. And depending on what that amount was and the amount of your deposit and IF the Realtor said something to the bank, you're best off either waiting for it to be foreclosed on where you can make another offer on it (at a decent price) or wait and watch for it to go to auction and bid on it. -just like Greg said.

If you really want it, and it sounds like you do, submit a written offer through either your attorney or get a buyer's agent locally and submit your written offer through them.

Edited out this content.

Okay, I got your last post and I won't re-post your questions here because you edited it out. Fine, but I'm still going to respond because 1. I enjoy typing and 2. You still have things mixed up and I don't mind explaining them.
From what I gather now:

• You made an all cash offer on your neighbor's house for less than what he owed, months ago because you found out he was going into foreclosure. His property you want because it adjoins your property. Your offer was submitted in writing to his Realtor but before it was listed.
• His Realtor began doing her job and working in a fiduciary capacity for her client by advertising the property and you were wondering why and if for some reason she was lying to you.
• Now from what I gather, your neighbor's property wasn't even in foreclosure when you made your offer, nor was it listed yet. But yet, you expect an answer from his Realtor for some reason why she advertised his home and you're under the impression your neighbor knows somehow how many offers came in. How can the bank even accept your offer if they've only just begun the foreclosure process? They can't. Can they keep your (less than what your neighbor owes) offer on their desk until the foreclosure process is complete? Yes, they can, but won't. They are waiting for multiple offers firstly and for the property to be listed that's why. The bank (much like private citizens) aren't going to take the first offer that comes along.
• Now, some time has gone by. According to you, months. Now, you're under the impression it's "on its way to a Sheriff's sale". -No, the foreclosure process takes months sir. Yes, the bank has to sue the occupants in court to make everything legal like so the bank can then take back their property and do what they want with it.
• When the occupants of a home go to their lender and either request a Short Sale or they forgo making payments (as you stated above, that your neighbor has done), the occupants are saying to the bank: "I'm sorry, here is my home. I owe you money and according to the Note, I have 20 years left and can no longer pay." The bank than "sues" the occupant, they file the necessary paperwork with the courts and take over the property. When this process is complete (taking months), the bank technically has all rights and privileges to said property because: 1) The owner did not fulfill their end of the bargain (paying off the Note in full) or they asked the bank to consider a Short Sale. Either way, the occupant is relinquishing their Bundle of Rights to the lender. The lender's recourse when a borrower (mortgagor), doesn't pay for whatever reason is to take back the property, hence suing the occupants (just a formality really, to keep everything legal) and thereby having the Bundle of Rights transferred via Deed back to the lender/bank.
• Yes, you can make an offer as you did on any property in the land but that doesn't mean the lender is going to accept that offer IF the property certainly hasn't gone to judgement yet. (yes, I spelled judgement correctly. With or without an "e" is acceptable in English grammar).
• Now months have gone by and I think you now realize that. 1) Your neighbor's Realtor can not and doesn't have to speak with you about offers that have come in. Because: they don't know because the bank doesn't tell them. And 2) Your neighbor isn't returning your calls because it's too soon in the game (foreclosures taking months now, remember...) and you submitted your offer before the bank sued him for non-payment: You submitted your offer even before the bank knew what was going on. Hence: "His bank said to list it with a Realtor".
• No, the bank isn't going to take your land from you if you're current in your payments sir. You even explained the foreclosure process here. Why you concluded that your bank would do this IF you are current in your payments is beyond my understanding, but so be it.

In conclusion, I'm 99% certain that, your offer "for less than what he owed" is in the bank's circular file. Why? Because 1) You made an offer on a property that wasn't listed yet. 2) You made an offer on a property that hadn't gone through the foreclosure/judgement process yet. -the bank didn't even know what was going on. 3) Your offer was for less than what he owed. 4) The bank is filing the proper paperwork with the county and may or may not be fully executed now at this point. Doesn't matter. When the property is transferred to the lender, and then listed, THEN they'll begin to accept offers. THEN the process of reviewing all offers that come in (NOT just yours, which has been thrown out quite possibly) takes months. Why? Because lenders, just like private citizens want the highest and best offer possible and keeping it on the market for up to a year is typical and warranted and increases the lender's chances of getting that highest and best offer, especially for cash. If at the time the bank has concluded they're not going to get the highest and best (months later), they can either send it to a private auction or have the Sheriff handle it. Or just keep it on the books and let it rot because banks don't care and have many properties listed.-this one particular property isn't special and is no exception.

No, there's no way to verify if your first offer was thrown out. Remember, the Realtor doesn't know. Your best bet now, if you really want it and to verify if your offer has been discarded is to submit another one in writing (and closer to what the asking price is to increase your chances of winning). Then the bank will probably get back to HIS Realtor and say "This guy already submitted an offer".

Good luck.

You've made a few incorrect assumptions and conclusions and failed to read what I wrote.

This thread was going nowhere and while I do appreciate the fact that you are trying to help, I think, I came to my own conclusion that you don't know what you are talking about so I tried to kill it.

There is no close thread option on this forum so I did what I could to end it.