Why a Lowball Offer on a Preapproved Short Sale Price is Silly
Every so often I get phone calls from investors who ask if my sellers will consider submitting a lowball offer to the bank for a preapproved Sacramento short sale. They realize the bank has preapproved the price but they expect to negotiate with the bank. For a hamburger today I will gladly pay you on Tuesday. They don’t understand that a preapproved short sale price means the bank will agree to sell at that price, versus, let’s say, a much higher price.
These are the kind of yo-yos who are probably used to dealing with a list price on an REO and they have little working knowledge of a short sale. If I say we’ll sell a home to them for a $1.00, they want to pay 50 cents. It doesn’t matter what the price is, they don’t want to pay it. They are giant time sucks. If you don’t want to offer the preapproved short sale price, I say go make somebody else’s life miserable and leave us alone.
Some go so far as to complain about the days on market. It’s been for sale for months now so the bank will definitely take less now — it ain’t gonna happen that way. The bank doesn’t have the property for sale. It’s not the bank’s property. The bank is not required to agree to a short sale. If the bank is agreeable to the short sale, the bank expects a certain amount of money, and if takes months to get it, so what? The bank doesn’t have a timeframe unless there is Notice of Default filed and, in that event, sometimes the bank WANTS the home to go to foreclosure.
Buyers have no idea what goes through the minds of bankers nor the policy guidelines from certain lenders for preapproved short sale prices. If the home doesn’t sell, it might not be price. It could be marketing, it could be condition of the home, showing difficulties or a bad location, all sorts of reasons. A buyer should not automatically assume how a bank looks at the days on market.
But then I’m basically talking to the wall. Over my last decade of negotiating hundreds of short sales in Sacramento as a top short sale specialist, I’ve learned that no matter how long it takes, a buyer will pay what the bank wants. It’s easier to wait for the right buyer than to try to pound a square peg into a round hole. Besides, I don’t work for the buyer. It’s not my lot in life to try to do favors for a buyer who is not my client. And most of the time, the banks are very reasonable about the preapproved short sale price.