Wow, that's a tough question. With the first time homebuyer's tax credit deadline just a little over two months away that is the $8000 question. And it is, of course, impossible to answer.
Every case is different, and while it may be possible to get the deal closed by the deadline, there are no guarantees in the world of short sales. We have closed some with local banks in just over a month, but this is a large institutional lender that would require approval from the investor. It could happen, it really could, but I still cannot answer that question less than truthfully.
My answer was that I would make this deal my top priority, and that I would do everything I could to make it happen. Beyond that, it is out of my control.
I sure would like to give it a go and see what happens!
All content, including text, original art, photographs and images, is the exclusive property of Coweta Fayette Real Estate, Inc., and may not be used without the expressed written permission of Coweta Fayette Real Estate Better Homes and Gardens Metro Brokers, Newnan Georgia. All information is believed to be accurate but is not warranted, Copyright 2003-2009. Richard Weisser REOS, E-Pro. licensed Auctioneer. 770-827-6225.
Learn more about Coweta County and Fayette County Georgia Real Estate, and to search the entire Georgia MLS for free with no registration required. Visit CowetaFayetteRealEstate.com! Photos of the Great Smoky Mountains National Park. North Georgia Photos.
The honest answer is maybe....the agents who advertise "pre-approved" short sales...huh ?...give agents and buyers the impression that they close in a minute...hmmmm...With ANY short sale listing the agents and buyers should know the listing agents experience in this area of practice.
Do you think the tax credit will be extended? We're getting the same question about closing prior to the expiration. It's difficult b/c some of the young kids really need the credit, and I hate to lead them to believe they'll close by the deadline, when we really have no idea. Good post... Thanks.
I think if you were to get it done by November 30th you would deserve your commission and more. The likely scenario is that on November 30 you would still be waiting for a response from the bank to the original offer.
With the November 30th deadline looming, I suggest to my first time buyers that we exclude short sale listings at this time if the tax credit is important to them. Most of my buyers choose to forgo the short sale homes because of the potential loss of the $8000 credit opportunity.
I actually closed on a Short Sale in two weeks once. It was a miracle. Really it had to be. I had one take almost 8 months. I would make sure any buyer today understands that the likely-hood of closing any loan in time for the $8,000.00 tax credit from here on in is less and less likely. I may even have new buyers sign an affidavit that indemnifies me if they don't get the credit because of a late closing.
Richard you have to ask yourself and your clients, what happens if it doesn't close by November 30th? Do your clients need the $8,000 to make the transaction work? Hopefully, it will close by this date and you won't have to answer these questions. Good Luck!
That would be a tall challenge but any real estate agent who knows what they are doing would give it a shot. Of course if there is a single lender and the price is reasonable for the market, perhaps yes!
Short sales and closing schedules are indeed a problem with the first time buyers credit. If the short sale has been approved you should be OK but if from scratch...its gonna be a close one.
Richard, If I were working with a buyer that wanted the tax credit I would NEVER place them on a short sale listing this late in the year. If they need that $8,000 I would not risk it on the slim chance they could close that quickly. It could happen but it's not likely. No matter what the listing agent says.
Hi Richard,
Nothing ventured nothing gained. If they really love this house and they don't have to have the $8K then go for it and it will be a bonus if it closes on time. It all boils down to the buyer's expectations. There are lots of houses out there on the market!
I have come up with an addendum for buyers to sign that states that we are not responsible and make NO guarentee that any sale will close in time to take advantage of the $8000 credit.
Richard,
I am no long showing 1st time homebuyers short sale listings if they have a "requirement" to close before November 30th, in order to take advantage of the tax credit.
If the government extends the timeframe, I'll reconsider.
Rich
Richard, it is a great answer. You can do everything in YOUR power, but you have NO control over the bank(s) involved!
It's up to the buyer if they are the gambling type...because that is exactly what they are doing in this situation!!!
To All...
I purposely left the post vague as to my role, in this case I am actually the listing agent and the question was posed by the buyer's agent. So I don't want to lose the chance at the sale, but I am compelled to be as honest and forthright as I can! And all I can do is try my hardest which I will do!
Richard: As long as you aren't dealing with Bank of America I'd say you have a fighting chance. Keep us posted!
There's no way to say what the bank will or will not do in the middle of a short sale negotiation, so you can never make guarantees. I'd also have the buyer sign paperwork saying that you can not guarantee closing on or before the deadline.
Based on all the short sale listings I already carry. .the answer is NO
Richard, like others above here have said. You're correct on the maybe, but if there's a lot riding on the deal, such as the $8,000 tax credit, the odds are probably against it.
Richard - I actually laughed out loud reading the title of your post. My first response was, "Of this year?" We have a short sale that might close this next week after a mere TEN months in progress, first with Countrywide, and now with Bank of America.
Richard, I had that same question come up to me this past week, and my only answer was MAYBE!!
My suggestion is to have a fully executed contract no later than Sept 30, 2009 to give the lender at least 60 days to go through the FHA process and/or conventional process.
Currently executed a direct buyer/seller contract 3 days ago since we have yet to hear from the "bank owned"REO submitted the end of August... We already had the inspections, appraiser came today, the closing agent will have the title work on Monday, the townhome asssociation is processing the buyer application and the credit union couldn't be happier.
I closed an approved condo short sale in three weeks with a cash buyer.
I locked up an executed contract September 15th with the seller and have yet to receive the third party approval...even though the listing agent said he works with short sales specialist attorneys to get the mission accomplished. It isnt imperative for this buyer to take advantage of the tax credit.
We have no control in the this arena...we consult with the parties and we listen to their direction.
Richard,
While my record is 23 days offer to close on a short sale, I'm finding lately that even the "responsive" banks are black holes. Your response was appropriate and honest. I hope you get that offer on your listing - and close it fast!
Richard - I just tell them - this is the wrong property.... No way would I risk a buyer's tax credit on a short sale approval in 30 days in this climate.
Richard,
I would almost think that with the staffing problems or apathy at the banks I would be a little less than cautiously optimistic.
I think that the buyers have to make the call ... is the house such a good fit that the $8K doesn't matter?
There can be no guarantees as the rush to buy moves forward!
With all the pressure on the deadline date I'm sure some of the deals won't make it I hope none of yours.