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Just got approval on another short sale in San Jose with Chase. They are getting to be one of my favorites!
This was not straight forward. Client lost his job and was not able to make payments. He tried a loan mod but did not qualify due to having too much in retirement account. Client is close to retiring.
Put condo on market and got 13 offers. The San Jose inventory for small affordable condos is quite low. Accepted an offer 30% over asking price, cash, with no appraisal contingency. Asking price was market value at the time of the listing. Last 2 sales in the complex were within 5K of listing price.
6 weeks later get approval from Chase but buyer, who was an investor, dropped out.
I start to worry because none of the other 12 offers were over 10% over list price and I am afraid Chase (or actually Freddie) will want more since first offer was so high.
Submit a back up offer for 10% over list price, cash with no contingencies. 4 weeks later get approval.
Everyone is happy!!!
So fortunately the first offer which was so high did not taint the the process, and since there was no foreclosure date set there was not a danger of losing the condo to a foreclosure. But this is a risk in short sales in the Silicon Valley. The inventory is low. There are many investors and first time buyers in the market competing with each other. Sometimes people make ridiculous offers which they later regret.
How do you know what is the best offer? Is it the highest, is it the owner who wants this home more than anything, is it the person who puts the most money in escrow, has the least contingencies?
This is a complicated question that deserves its own blog. But my best advice to sellers of short sales is start by picking an experienced agent who knows how to analyze offers from a short sale perspective. This is not the same as a traditonal sale perspective. And understand that sometimes things go south, so be prepared for some bumps in the road to finally get to the magic words:
Congratulations: You are off the hook!
If you have any questions about short sales in San Mateo or Santa Clara County please feel free to contact me.
Keller Williams Realty