steve's White Mountain Blog


Short sale in New Hampshire are not always better than a market value sale.


I have been a Realtor for 27 years in the White Mountains of New Hampshire, but what I'm about to discuss is the same in every market in the U.S. Let me call the market sale "property M' and the short sale "property S" - let's assume they would both appraise at the same price and are the same style and basic floor plan.

Negotiated settlement on property "M" ...offer made and accepted at $205,000. The Home inspection reveals a failed window, a broken ground wire (other small electrical issues), and out of code pressuring reducing valve (and other small plumbing issues). Since these are Code and structural issues the seller agrees to make the needed repairs. The closing happens in 40 days from contract to close. The place is delivered clean and in good working order.                                    

Offer is made on property "S" seller accepts $195,000 subject to lender approvals. The seller provides a hardship letter to the lender, they provide two years of tax returns and a financial work sheet. The bank negotiator opens the file asks for review and out side opinion of value. three weeks go word from the lender, no contact from bank hired appraiser. Seller continues to live in the property but has stopped making all association fees (6 months ago) payments. Buyers have a home inspection a month after the contract is signed...find similar problems as the market value sale...but in this case the seller has no money and wouldn't make repairs. Buyer moves forward because the deal is "so good". Six weeks in the appraisal is done and the lender asks the seller for a cash               contribution at closing, the seller says "no I will not bring money to closing -if you don't like it go ahead and foreclose!" We continue with the bank negotiations and forward them a proposed HUD settlement. The lender refuses to pay off the HOA fee because we are in a non-redemption state. The Home owners association has placed a lien on the property - a pay off agreement must be negotiated to allow the buyer to get a "clear title". The Buyer agrees to pay off the $4,000 HOA fee at closing...after all they are getting a "great deal".

Final closing on the short repairs, HOA fees on the buyers side of the settlement statement (with release fees and discharge of lien recording fees this added $5,000 to the deal) No repairs made, the property is left in horrible condition and dirty (as the seller doesn't care anymore) and the closing takes place 150 days after contract.

    WHO GOT THE BETTER DEAL?                                                                     

Was this an extreme example? No this actually closed in a reasonable amount of time given the bank requirements and the speed they are reacting to the files. Did I paint the seller unfairly - NO, they are about to take a credit hit and are difficult to work with...they are disgruntled, embarrassed and stubborn...and blame all Realtors and lender for their unfortunate circumstances.

It's not Just "Black and White"...If you need the seller to contribute money , repairs or close in a timely manor a Short sale may not be for you. There are some great deals on short sales but you must  be willing to buy as is and wait for a closing yet to be determined

Look for any type of property in the White mountains of New Hampshire, use the MLS search button at the bottom of this post or call me directly.


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Comment balloon 19 commentsSteve Loynd • July 31 2011 10:27AM
Short sale in New Hampshire are not always better than a market value…
I have been a Realtor for 27 years in the White Mountains of New Hampshire, but what I'm about to discuss is the same… more