Bank Owned & Short Sales - TODAY

Bank Owned and "short sale" listings now represent about 50% of the home sales occuring under $250,000 throughout the metro Denver market today.

What this means to a buyer is that they will need to wait anywhere from ten to 45 days to receive written notice back from the seller that their offer to purchase was countered or accepted. Many buyers simply do not have the time to wait that long for a response. Over the past year I have had several clients who initally wrote an offer on a lender owned property and then decide to purchase a home where the owner was still in good standing with their lender. (or non lender owned & non 'short sale" property). Buyers writhing contract offers on this type of active listing typically are firmly under contract within a few days instead of many weeks as can be the case with lender owned properties.

One other major issue buyers need to consider when dealing with lender owned, pre-foreclosure, foreclosure and short sale contracts is that anyone else can write a better offer while you are waiting for the seller to respond to your offer. Even if your contract offer states that you are in first position to future offers, the seller only needs to reject your offer to be able to accept another, better, offer. In the best case, the seller would counter both offers to at least give you a chance to be in the running to purchase the property. This type of negotiations can be quite challenging and frustrating.

With a 1.9 month supply of homes on the market under $150,000, it is a very good chance that you will see multiple offers on the most desirable (best condition & best location) properties. My last closing was with a client who found the home 49 days after someone else wrote an offer on the same property. We ended up being the high offer while the other couple had to start their house hunting process all over again.

My next blog will discuss exactly what a "short sale" is and why they can be tricky to negotiate.