Ok so I was searching through the mls and I found one listing that said its a short sale, just needs banks approval. The way it works is the bank hired a real estate agent to go talk to owners who are behind on their payment and see if they want to list (short sale) the property. The owners owe $178,000 on the property. The bank listed it on the mls for the owners for $178,000 about 4 months ago, they recently dropped it down to $158,000 and taking offers. Im trying to figure out how much should I offer them for the property. But I don’t want to low ball them too low.
Depending on your exit strategy, I would treat it like any other purchase you would do and use the same formula.
David
Ok i just found out more info. The realtor told me the owner owes $178,000. But i kept looking through the mls and I found that the mortgage balance is $129,963 and the judgement amount is $142,786. So I guess the realtor was lying about the $178,000 so that I can offer a higher price. So what do you guys think I should offer after seeing these numbers? Please help
I think someone’s trying to bone you.
Banks don’t list short sales on the MLS, at least not that I’ve seen, and they certainly wouldn’t advertise the fact that they’re willing to take less than they’re owed.
Sounds to me like a fast talking realtor
What is the ARV? Repairs? See what you come up with on that. I have heard from a realtor that some banks are letting realtors know that they will take a short sale. It was news to me, but the times are a changing and there are many foreclosures and competion. Maybe they are saving money this way or something like that.
Run your numbers for your offer like you would any cash purchase unless you intend to wholesale it and that would be something different.
I think that you are a little confused on how this really works. The lender (bank) doesn’t send an agent to see if the owner wants a short sale. Why would they ever want to do that? They want all of the money that is owed to them.
The owner calls a brokerage and wants to list the property. Once the agent sees that more is owed than the property is worth he lists it as a probable short sale.
It is the function of the listing agent to contact the lender and see if they will accept a short sale.
Banks usually can’t list a property on the MLS unless they are members of the local Realtor Board - and I’ve never heard of any that are members.
When a property becomes REO then the lender gets a broker to list and sell the property.