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LRMom
Posts: 2
Registered: ‎02-06-2013
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Wish something could be done about stuff like this...

How is it possible that this short sale home, that just closed on 12/21/12 for $408,000 is now back on the market in less than 30 days for $549,900?  The seller's agent and buyer's agent work together and now it's listed as a clear flip that's how.  Disgusting. We were told our offer of $415,000 was the offer being considered by the bank.  Obviously a lie.  We never had a chance. 

 

http://www.redfin.com/CA/Ladera-Ranch/10-Kelfield-Dr-92694/home/5936794

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Justsaying
Posts: 205
Registered: ‎12-13-2009
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Re: Wish something could be done about stuff like this...

 


LAz wrote:
"Obviously a lie.  We never had a chance." 

 

http://www.redfin.com/CA/Ladera-Ranch/10-Kelfield-Dr-92694/home/5936794



LAz I feel for you! Unfortunately this is very common and  the realtor has the power to do whatever is better for him/her with a short sale or any sale! This was a CASH transaction.

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sheriff
Posts: 2,319
Registered: ‎06-01-2012
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Re: Wish something could be done about stuff like this...


LMom wrote:

How is it possible that this short sale home, that just closed on 12/21/12 for $408,000 is now back on the market in less than 30 days for $549,900?  The seller's agent and buyer's agent work together and now it's listed as a clear flip that's how.  Disgusting. We were told our offer of $415,000 was the offer being considered by the bank.  Obviously a lie.  We never had a chance. 

 

http://www.redfin.com/CA/Ladera-Ranch/10-Kelfield-Dr-92694/home/5936794


It is probably not a flip.  A flip indicates someone actually did cosmetics improvements to the house.  Since there are no pictures of the interior of the house,  they probably did not do anything to it, except list it for resale in the busier season after the holidays.

Trusted Contributor
Seneca
Posts: 186
Registered: ‎02-13-2012

Re: Wish something could be done about stuff like this...

Nobody is obliged to sell you a house.  If I come along and offer you Kelly Blue Book value for your family car, do you feel there ought to be a law forcing you to sell it to me, just because I offered a fair price?

 

The original listing said this was a short sale.  if you offered a financed offer at 415, with all the usual contingencies, and someone else offered 408 in cash, no contingencies, close tomorrow, then it would be no surprise at all if the bank took the second offer instead of the first.  The bank was probably taking at least a 90k hit on this sale, and for the mere sucking up of another 9k, they perhaps got to unload the property with a minimum of fuss, without having to worry about someone actually closing the deal, appraisals, inspections, whatever.  Well worth it.  And since they were the person controlling the sale, they get to sell it to who they like, and for whatever reason they like.  Just like you can, when it comes your turn to sell.

 

As for it being a flip, oh well.  If you are truly disgusted that someone might want to do this, then you can punish them by not making an offer on the house.  If nobody does, it will sit there unsold.  If your 415 was a completely fair price for the house -- in Ladera?  For a 2100 sq ft 3BR SFR?  Hmm..... -- then the poor flippers will lose their shirt on their flip and be adequately punished for their greed.

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Viss
Posts: 133
Registered: ‎05-24-2012
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Re: Wish something could be done about stuff like this...

Wow, yea $415k in LR would have been a steal! I'm right up the road, in Las Flores. There has been one comparable house in our community sell for less than $500k in the 6 months I've beeh here. It was a short sale that was pending for A YEAR and had some pretty bad mold in the house and a rat infestation outside. So from what I'm told, a deal with quite a bit of work ahead.

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SunshineTax
Posts: 94
Registered: ‎01-14-2013
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Re: Wish something could be done about stuff like this...

unfortunately the listing agent gets to pick and choose what offers go to the bank for a SS. 

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BobPhillips-RE
Posts: 1,701
Registered: ‎12-13-2010
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Re: Wish something could be done about stuff like this...

There's a good reason that the listing agent is the gate-keeper of offers with a short sale listing.  If ALL offers were submitted to the short sale lender's negotiation team, short sales would take at least twice as long as they already do.

 

Here's why.

 

The first offer submitted to the short sale lender has to undergo at LEAST a 2 or 3 week period just for it to get to the negotiator, primarily because those negotiators are - STILL - bogged down with dozens, perhaps hundreds of transactions to process.

 

When a new, better offer gets delivered to that negotiator, where do you think it goes?  To the bottom of the pile, starting the processing for THAT property all over again.

 

For that reason, once short sale listing agents figured this out, ( A few years ago.) they began sorting out ONE of the offers received - usually from many - they select the ONE that they think is THE most likely to become eventually "approved" by the lender - a month or two down the line.

 

Hopefully, once the lender sends the listing agent a letter of approval - or a counter-offer - the original buyer is still there, waiting patiently.  

 

Up until a year ago, the majority of such first buyers had disappeared, having moved on to a different property.  Over the past year, though, buyers have figured out that there ARE no other properties, and so they've been hanging in there, waiting for either the approval, or an acceptable counter-offer.  Consequently, more of the past year's short sales have been being completed to the first offer submitted.

 

Listing agents are just like every one else - they strive to stream line the system, improving their odds of closing more short sales, in the shortest period of time.

 

And that, my friends, is why short sale listing agents are the gate keepers of their listings.

All this, of course, is merely MY opinion. Thanks for reading.

Bob Phillips - Realty ONE Group - South Orange County, CA
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Flaaash
Posts: 37
Registered: ‎08-01-2009
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Re: Wish something could be done about stuff like this...

So Bob, when you have a client wanting to sell their home, do you weed out which offer to show them and which one to throw away or do you show them all the offers and let them decide which one they would like to go with?  That same principle should hold true for the bank, as they are the actual sellers, not the home owners who refuses to take responsibility. Furthermore, as gatekeepers, what checks and balances are put in place to make sure they are being ethical?  I've noticed that the majority of these short sale agents are from non-name brand company that seemed to have popped up overnight.

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BobPhillips-RE
Posts: 1,701
Registered: ‎12-13-2010
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Re: Wish something could be done about stuff like this...

Fellow poster Flaaash asked a few questions which I'll respond to, one by one:

 

"So Bob, when you have a client wanting to sell their home, do you weed out which offer to show them and which one to throw away or do you show them all the offers and let them decide which one they would like to go with?"  

 

Flaaash, short sale sellers are COMPLETELY different from equity sale sellers, in a couple of important ways.  As my post - which you responded to - was referring only to short sales, I'll answer from THAT perspective.

 

A short sale seller has absolutely NO reason, or incentive, to "screen" prospective offers, and in 99% of cases rely upon the listing agent's "expertise" in deciding which of - probably many - offer to choose from, as the ONE which will eventually wend its way through the lender's system.  That leaves the listing agent as the best person - usually, based on their experience - to decide on the ONE best offer, out of the many - to submit to the lender.

 

Other offers are either relegated to potential back-up status - with those agents being so informed - or flat out rejected as not being likely to successfully undergo the lengthy process to a final lender approval.  Those agents should also be so informed.

 

There MAY be a little counter-offering, to one or more of the buyers, to "clean up their offers", but eventually only one offer remains standing, in first position.

 

Once the lender comes back with their eventual approval or counter-offer of offer number one, if that buyer has "hung in there" and is still interested, a deal is forged and escrow is then opened. ( Opening an escrow before lender approval is not usually recommended, for a plethora of good reasons.)

 

IF, the original "winning" bidder has disappeared, OR, they're not agreeable to the lender's counter-proposal, then the backup buyers - if they are still in play - have a FIRST opportunity to either match the lender's proposal, or make a counter of their own.

 

If no transaction comes together at that point, the property is - usually - re-exposed to the general market - in the MLS - to begin the same process all over again.  One advantage at THIS point, is that the listing agent now has a clearer idea of what terms are going to be approvable to the lender,(s) and the list price SHOULD be adjusted, accordingly.

 

This chain of events USED to be standard operating procedure for short sales, but - as I mentioned previously - a much higher percentage of FIRST "winning" buyers are now holding onto their first position, and more likely to agree to any changes in terms, proposed by the lender. ( Because there are so few other choices, available to switch to.)

 

Next question: "That same principle should hold true for the bank, as they are the actual sellers, not the home owners who refuses to take responsibility."

 

The bank is NOT the seller - the homeowner is.  All the bank wants is for the process to go through, with one buyer, as quickly as possible.  As I stated before, if the bank was peppered with additional offers, all it would do is slow the process down - considerably.

 

Last question:  "Furthermore, as gatekeepers, what checks and balances are put in place to make sure they ( Listing agents.) are being ethical?"

 

Unfortunately, there are none, other than a "Code of Ethics" that most of us are sworn to uphold.  While being the gatekeeper has its advantages - IF the agent is experienced, with such scenarios - it also has its temptations to earn a bigger commission.  I wish I could give you a better answer, but I can't.

All this, of course, is merely MY opinion. Thanks for reading.

Bob Phillips - Realty ONE Group - South Orange County, CA
Regular Contributor
SunshineTax
Posts: 94
Registered: ‎01-14-2013
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Re: Wish something could be done about stuff like this...

Answer: There are only nominal checks and balances for short sales that are rarely (if ever) enforced. Short sale fraud is rampant in OC.