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Thursday, October 7, 2010

Ventura County Short Sales: Why Banks Reject Short Sale Offers and what to do about it


Ventura County CA – Banks reject short sale offers for a number of reasons. The biggest reason is because they feel the property is worth X and the price is below that number.
For example, you might have a buyer willing to pay $119,000 for a short sale. The bank orders an appraisal.

Discover how other sellers successfully did a short sale and request a free consultation by clicking here.

The appraisal comes back at $135,000. Usually the bank will turn down the offer and ask the buyer to increase their offer. Often times the buyer will agree to pay the higher price.
Here is another reason short sale offers get turned down: The lender doesn’t have a complete short sale package. Maybe the seller’s last 2 bank statements are missing. Or, a page is missing from the sales contract. In that case, the necessary paperwork will be sent to the lender.

Reason #3: The offer doesn’t meet the short sale guidelines. Every lender has different guidelines for whether they will accept or reject a short sale. For example, the owner of the loan might be Fannie Mae. Fannie Mae has specific short sale guidelines. Unless the short sale offer meets those guidelines, it will be rejected.

Reason #4: Unrealistic expectations from the lender. Every lender has a specific employee who negotiates and processes the short sales. That employee is called a short sale negotiator.
This employee has a lot of discretion over what they will and will not approve. We have seen those employees make up their own guidelines. They decide that Fannie Mae’s short sale guidelines aren’t good enough. So they demand more money from the buyer. Or they want the seller to give up their entire life’s savings.

If the seller or buyer do not agree, then they will turn down the short sale offer. Never mind that they do not own the loan. If the short sale is turned down then the owner of the loan, Fannie Mae, risks losing even more money.

Most short sales that are foreclosed upon end up selling as a bank owned property. The Boston Consulting Group recently did a study on short sales. They studied what a lender would net when selling a home either as a short sale or a bank owned property.
They discovered that banks lose twice as much money on bank owned sales versus what they lose on short sales. What should your agent do with a short sale negotiator at the bank who doesn’t follow the short sale guidelines?

We gently remind them of the loan owner’s guidelines. They usually approve the file. If that doesn’t work, then we will notify their supervisor or someone higher up at the bank.
That solves the problem most of the time. But, if it doesn’t, then we contact the owner of the loan directly and let them know what is happening. That is the basis of what we do to get your short sale approved and help you move on with your life.

Thinking about a short sale? I can help you short sale your property and never pay the bank another penny. Send me an e-mail at cjohnson@prucalhomes.com. I will contact you for a free consultation.
When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at 805-208-0823.

Discover how other sellers successfully completed a short sale and request a free consultation by clicking here.

Thinking about a loan modification? Our Ventura County Loan Modification Kit has the instructions you will need to get a loan modification approved with your lender. Click here to request a copy.

Thanks for reading this,

Chris Johnson.
Chris is a Real Estate Agent at Prudential Califonia Realty.

Phone: 805-208-0823. cjohnson@prucalhomes.com.
Certified HAFA Specialist, Certified Short Sale Specialist

View My homes for sale at http://www.chrisbjohnsonrealtor.com/.

Chris Johnson specializes in loan modification assistance and Short Sales in Moorpark, Thousand Oaks, Westlake Village, Newbury Park, Camarillo, and Simi Valley California. Moorpark Loan Modification Help, Thousand Oaks Loan Modification Help, Westlake Village Loan Modification Help , Newbury Park Loan Modification Help, Camarillo Loan Modification Help and Simi Valley Loan Modification Help, Moorpark short sales , Thousand Oaks short sales, Westlake Village short sales, Newbury Park short sales , Camarillo short sales, and Simi Valley short sales. Moorpark Short Sale Realtor, Short Sale Realtor. Ventura County CA Short Sales. Ventura County Realtor, Certified HAFA Specialist, Moorpark Short Sale Realtor, Thousand Oaks Short Sale Realtor, Westlake Village Short Sale Realtor, Newbury Park Short Sale Realtor, Camarillo Short Sale Realtor, Simi Valley Short Sale Realtor, Moorpark CA Short Sales, Thousand Oaks CA Short Sales, Westlake Village CA Short Sales, Newbury Park CA Short Sales, Camarillo CA Short Sales, Simi Valley CA Short Sales, Certified Home Affordable Foreclosure Alternative Specialist providing HAFA Loan Modification and short sales help in Ventura County California. Ventura County Loan Modification Help, Ventura County short sales. Ventura County Short Sale Realtor Short Sale Realtor. Ventura County CA Short Sales. Ventura County Realtor.

Copyright 2010 SFI Marketing Institute, LLC. All Rights Reserved. This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing. The views expressed here are Johnson’s personal views and do not reflect the views of Prudential Califonia Realty. This information on Why Banks Reject Short Sale Offers is provided as a courtesy to our viewers to help them make informed decisions.

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