Hi, this is Kerri from the Bay Area Short Sale Angels, Bay Area’s number one short sale team. I’m here to talk to you about what happens after the BPO or Broker’s Price Opinion. After the BPO is ordered, it typically takes about a week and a half to 2 weeks for that BPO to come in with a value to the short sale negotiator. Once the negotiator gets the BPO, then they are able to take a look at what we have on the table. It’s a purchase agreement, or an offer on the property and the BPO which is the broker’s opinion on what the property is worth. Then they weigh them and they will make one of three decisions. The first decision is an approval. Once we get an approval then approval letters come out about a week and a half to two weeks after. At that point we can open escrow and follow through with a traditional escrow period which is the same as with any other real estate transaction.
The second decision would be for them to counter the offer that’s on the table. This is what we tend to see happen more often than not. Once we get a counter offer, then we go back to the buyer and ask them if they want to accept counter or decline the banks counter offer. At that point it can go back and forth until everybody gets to a point they are happy with or until one of the parties decides forget it, it’s not worth it, and I’m walking away. If the buyer in first position or if the bank decides that it’s just not going to work out, then we go to the back up buyers and tell them what the bank is wanting and ask if they can step up to that amount. Sometimes they will, and sometimes they won’t. Most of the time we have enough people waiting in the sidelines that we can find something closer to what the bank will be happy with.
The third decision would be to deny the offer and the short sale. This doesn’t happen quite as much, but it does happen. Typically we’re able to find out why it was denied. Once we determine why it was denied then we are able to go out there and try and find a buyer that’s closer to what the bank would approve. If we don’t get that information, then it’s a big guessing game. We just go out there and try and find another buyer until we get the approval.
Once we get the approval letters, then we can open escrow and close traditionally. Depending on what the terms are it will determine how long until closing. It could be an FHA which would be about 45 days to close, or a conventional offer which would close in about 30 days. We could also have a cash buyer which takes about 10-15 days. So that’s what you can expect. This is Kerri from the Bay Area Short Sale Angels, Bay Area’s number one short sale team, where we believe there is nothing worse than doing nothing.