Ellicott City Realtor Catonsville Realtor

I myself am buying a home right now.  I am buying a house that is a Short Sale, and I'm buying to try to stop a foreclosure.  A Short Sale happens when the owner of a home can no longer afford to keep the home, and cannot sell the home for what it is worth.  Theoretically, the Lender/Bank will accept less than the total amount due if the Owner qualifies.

Part of this process in getting a Short Sale approved by the Bank entails the Owner showing that they can no longer afford to keep the house.  The Bank gathers financial information on the Owner - income, credit, retirement accounts, checking accounts, savings accounts....wherever the Owner may have money.

Then the Bank orders a BPO - a Broker Price Opinion.  This tells the Bank what the property is currently worth.  These are typically done by experienced, local Realtors.

The offer that I made on this property was $125,000.  The BPO came in at $120,000.  You would think that the Bank would be happy to accept this offer, right?  Wrong...

The next step in the process is that the Bank sends out an appraiser to do an official appraisal.  The Bank does not disclose what the appraised amount is, but they come back saying they want $185,000 for the property, or $65,000 more than the BPO.

When I ask about the comparable sales used for the appraisal, the Bank gave me sales for houses with addresses on the same street, but 20 miles away.  I had to convince the Bank that the appraiser did the appraisal on the wrong property and mind you, he did not go inside.

Remember....I was purchasing this property to stop a foreclosure.  The Bank ordered a new appraisal for the correct property and came back with the same counter offer of $185,000, which is outrageous.  The house likely needs $50,000 of work.

I just found out today that the home is going up for auction tomorrow.  We put this deal under contract last July.  Since then, a lot of time has passed, and I think the Bank just wants this deal off their desk. The Bank is not returning any phone calls.  And tomorrow, at 2:30 pm, the Seller is probably going to lose his house, not to the highest bidder either.  He's going to lose it right back to the Bank, because based on the deposit amount that the Bank wants for the auction, their bottom line is $185,000 and they are sticking to it.

So after all of this, the Bank is going to then have to take the property back, only because, in my opinion, they don't have the time to do what is right.  What would be right is for the Bank to get a proper appraisal done by an appraiser who actually goes inside the house.

Now, the Bank must evict the Tenant, clean up the home, and hire contractors and a Realtor to get it sold.  Additional costs = additional losses.

What could have been done differently?