About Orange County Short Sales these days
As we are entering the Spring season ( our best real estate one), we’ve seen that many properties get multiple offers on them. Remember how years ago, it was the one buyer offering the highest bid the one that would get the one? What about a couple of years ago, when the expression ‘cash is king’ was the biggest fear for any buyer competing on a home? With the many short sales we see these days, is the cash offer the strongest one? Or is it the highest? Apparently none.
Cash is Not king!
While it is true that an all cash offer is definitely a strong one, this might not be the best one for the seller’s interest to choose in a short sale. Given, short sales these days tend to be more organized and the lenders are doing a better effort with timelines and responses, but the short sale process from start to finish is still a lengthy one.
So while cash is the king in some cases, is definitely important for the seller and the selling agent, as well as the buyer and buyer’s agent when writing an offer, to understand how some other offers have a better chance to stick it up until the end and make both ends meet.
Cash might definitely not be the king if the buyer doesn’t agree to many conditions set by the bank, or if the buyer demands a quick escrow given the ‘all cash’ offer. It’s important to understand as an all cash buyer, that the cash offer is not going to shorten the short sale process, only going to shorten it after a lender approval. The time frame before that is what takes the longest, and to the lenders involved it really doesn’t make a difference if there’s cash, they will still take their time approving the price and this will not make a difference either in setting the price either. A lender might come back with a higher approved short sale price for a home, and while in an all cash offer the buyer doesn’t have to worry about appraisals and approvals from a lender, it doesn’t mean that the bank will take the offer at the given price.
Highest is not Best
So sure, the highest seems to be the best offer a seller can choose for a simple reason: it will help the bank with the difference between what’s owed and what’s offered, so technically could help the seller get the short sale done. But when evaluating all offers presented to the seller, even when the highest can also be the best offer, is very important to evaluate which one has the best interest for the seller. Here’s an example: the bank might come back with different terms and conditions like refusing to pay for certain inspections, or again, the buyer might need to move pretty quickly or not be able to wait months for a response. A buyer with a lower price offer but willing and able to wait the time, and aware of these possible changes in scenario, is probably a better buyer. An since the seller is not profiting at all from the sale, then that’s what’s really important to make the transaction successful.
Who is the Best Buyer for a Short Sale in Orange County?
Within short sales, we must say that the buyer who is committed to wait and the most flexible with accepting changes in terms will be the best buyer to the seller’s interests ( not only the home owner, but also the lenders involved). A buyer who can afford to come up with money for inspections, and who also has stronger reserves for changes in price given a change by the bank. The buyer who really really wants the home at all costs.
Given all the scenarios, choosing the best representation as your agent is also key for a great transaction. A savvy agent, who also knows their peers and can guide you as to what to expect so not everything is a surprise is your best bet in a short sale transaction. If you are a seller, look for an agent who’s experienced in short sales too, because with their contacts they can move transactions faster. Our agents at OCDreamhomes are experienced with short sales and can guide you through these transactions. Are you ready to sell your home as a short sale? Or do you want to buy that home listed as a short sale? Let us know. We are here to help.
Check out all the available Orange County Short sales right now.