Through the short sales that I have been working with, on the listing side, most of the contracts that my clients receive from prospective buyers have one thing in common. The acceptance date for the contract is either omitted, or written out 60 to 90 days in advance.
This does not make sense. If you’re a buyer, and your agent writes a contract on a short sale, or any other home for that matter, take into consideration that line 362 of the Arizona Residential Purchase Contract is where you set the time limit for the seller to accept your offer, not for the bank to approve the short sale.
When you write a contract, you give the seller a time limit to respond to your terms. If the seller does not respond within that time limit, the contract is essentially dead.
Without Seller Acceptance, bank approval cannot be sought. The process goes in that order. First, you write your offer and you give the seller a specific time period in which they must respond to your offer. Then, when there is an ACCEPTED contract, the offer is submitted to the bank for approval. Bank approval is what takes time. Seller Acceptance does not take that much time. Unless you instruct your agent to do so, setting an acceptance time limit of 60 to 90 days won’t help you.
It is in everyone’s best interest to move quickly through a short sale transaction and that includes a reasonable, realistic time frame given to the seller to accept your offer.
Remember that when the seller accepts your offer, all they’re saying is “yes, we agree that this amount will probably be satisfactory to the bank, and we’ll submit it after we accept it.”
Don’t get an accepted offer confused with a short sale approval, also known as a Letter of Agreement.
I recently presented an offer to my seller that named a month as the cut off date. When I asked the buyer’s agent what their time limit really was, it was made clear to me that the buyer’s agent didn’t know how short sales worked. They said that they just thought that they would give the bank enough time to respond and that they thought their offer was going to the lender for acceptance.
This is not how it works.