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Seller Pays Difference in My offer and what the Bank Wants

I put in an offer on a short sale. I did not know that my realtor put in the contract I would open escrow at sellers acceptance not sellers bank acceptance. Now a month later my agent tells me the problem the seller has is the bank wants the seller to pay the difference between my offer 500,000 and what the bank wants 550,000. I told my agent that doesn't sound right because it is a short sale. Isn't the bank letting them out of their loan with a short sale? The bank countered for 550,000. If I reject will I get my earnest money back? Will I owe the settlement company?
  • June 26 2014 - Fairfax
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Answers (4)

Adding to Scott's reply.

 The bank has countered your offer and you have two options.  Counter with a higher offer or walk away.  Your EMD funds will be released as a result of rejecting their offer, the transaction is now dead.  You owe the settlement company nothing at this point unless there are unpaid services already rendered (home inspection, survey, pest inspection, etc.). 

I would suggest sitting down with your agent to talk about the short sale process further and if it something you wish to continue further.  There needs to be a clear and open line of communication in order for this to be a successful buying experience.  Surprises of this magnitude are not fun, especially when your EMD funds get locked up. 

Best of luck with your future purchase.
  • July 01 2014
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Profile picture for wetdawgs
A short sale has to  be approved by the lender, and it is not unusual for the lender to have a different opinion of value than the seller.   No lender is obliged to allow a seller to short them.  Usually the seller has to document hardship.

  • June 26 2014
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Adding to Scott's reply, the escrow company generally won't charge you unless the transaction is completed.
  • June 26 2014
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You will get your earnest money deposit (EMD) money right after you decided to not take their counter. Those funds are strictly to protect the seller in case you as the buyer default on a ratified (accepted contract. In your case it has to be ratified and accepted by both the seller as well as any lenders involved. If one or the other fails to accept your offer, there is no ratified contract.

Hope that helps!

Scott
  • June 26 2014
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