In Short Sales, the seller has no money left. That’s why they’re doing a short sale in the first place. The bank decides on the approval price, pays the agents’ commissions and closing costs. The bank is trying to reduce the cost of a foreclosure, and approve prices also based on the idea that by giving you a better deal, you will not give them extra costs.

Of course, the banks also understand that sometimes there are huge monetary repairs like A/C Systems, roof leaks, and cracked pools, that will deter any buyer from purchasing the home. In cases like this where they know they cannot move the home, they may choose to help you out. Unless it is a safety or marketing issue, the banks will usually not willing to incur the fixing costs.

BE WARNED: When purchasing an REO or Short Sale home, realize that you are getting the home for below market price and the bank will not help you fix up little repairs. Carefully examine the home and take in all of the little dinks before putting in a serious offer, that way there will be no surprises in escrow.

Chapter 5: REO Properties are NOT the Cheapest