You Can Buy and Sell at the Same Time
You may read about this remarkable real estate transaction in the Kiplinger Newsletter this fall. It’s a story about clients who decided to buy and sell at the same time, with odds against them. The thing that makes it unusual is the fact it is hard, if not pretty much darn impossible, for a home seller in Sacramento to sell his home and then buy another home concurrently with an FHA loan. Throw in the fact that the home the seller/ would be-buyer is buying is a short sale in Elk Grove, and it becomes even more unlikely. Complicate this further by the fact the home the seller is selling is located in a somewhat not so desirable location, and the scenario sounds almost crazy nuts.
It was nuts. When I initially met with this seller and his fiancé, I could sense that he wasn’t quite sure that this Sacramento Realtor could be trusted. Many people don’t trust real estate agents. Heck, many people don’t trust anybody, period. But I sometimes meet people whom I suspect have a bad taste in their mouth for agents. I can see it in their eyes.
For me, well, I have nothing to lose. A client either wants to work with me or they don’t. No skin off my nose. If they don’t want to work with me for some odd reason, I am certainly not about to try to persuade them, because the world of real estate is tough enough as it is, and I don’t need any crazy people complicating it further. I gave it to him straight. Being straight meant he either put his trust in me and listen to my advice or he can go elsewhere, and if he goes elsewhere, he probably will not buy a home. That’s how this market is today.
An FHA buyer who is putting down 3.5% often falls to the bottom of a multiple-offer presentation. Moreover, if an FHA buyer also has a home to sell as a contingency of sale, well, you can pretty much forget about it. Not gonna happen.
Except it did. I went to the seller of a short sale in Elk Grove, who was my client. Elk Grove is a super hot market in which 20 offers is not unusual. When the buyer wrote an offer through one of my team members, I explained to the seller that I was the agent responsible for selling that buyer’s home, so you know it will sell. In fact, we were so confident in my ability to sell it that the buyer gave the seller 17 days to remove his contingency to sell. Within that time period, not only did I sell the buyer’s home, but I closed it.
I submitted the offer to the short sale bank. The bank wanted more money. The seller offered the bank more money (it was Fannie Mae, which often demands over market prices). The bank approved the short sale but reduced my commission. I ended up obtaining a statement from the U.S. Treasury to prove to the bank that in a HAFA short sale, commissions cannot be reduced. The bank backed down and revised its approval. Then the buyer’s appraisal came in for the amount the buyer originally offered.
My client trusted me. Both of my clients trusted me. They both got exactly what they wished for.
The bank backed down again, reduced the price to the buyer’s original offer, and we closed yesterday. Yes, indeedy, you can certainly buy and sell at the same time.