Short Sale Question from Newbie

First and Second mortgages are both two months behind. The first mortgage is requesting a listing agreement. 1. Does the listing price on the listing agreement bear any relevence to the negotiated short sale price of the home? 2. Also, they are requesting a purchase agreement. What is the standard format for a blank purchase agreement to submit with no price and no closing date? 3. The Bank is requesting a purchase agreement. How do you send in a purchase agreement to the bank without knowing their negotiated price?



You can offer whatever you want. The listing price is irrelevant. A house can be listed for $100,000 and have a $100,000 note on it, but you can still offer $70,000 for the house and work to negotiate a $30,000 discount on the note.

The purchase agreement that everyone is asking for is your offer, which is, as I think we agree, going to be for less than the listing amount. There will not be a blank in the agreement; you’re going to disclose your offer price, and then see if you can get the lender to accept it.

Thank you for your response- Do you have to do a SS package for the 2nd mortgage?


You have to do one for any lender that you are asking to take a discount.

How much of a discount depends on the amount of each loan and the value of a property.

Just an example…if the house is worth $100K and the first is $60K and the second is $40K, the first is not going to negotiate very much at all because they are well secured and likely to be made whole.

If in the same house the first were $100K and the second were $20K (the house is overleveraged), the second should be happy to get 10 cents on the dollar, if that, and the first is likelier to entertain a discount, too.