Believe it or not, some home buyers are having a very difficult time buying a short sale in Sacramento these days. You might ask yourself, why is that? Is it because the Sacramento market has limited inventory, which is causing buyers to compete with each other for some of the same homes? Or because lenders are tightening the belt in underwriting and kicking out loans for the slightest discrepancy?

In part, but not in whole.

I propose that the 2 biggest problems buyers face in a short sale situation are pricing and patience. Some buyers don’t want to wait for short sale approval because their buyers’ agents, for whatever reason, did not properly counsel them and explain that short sales can take, on average, 3 to 4 months to get approved. As a Sacramento short sale agent, when I am working with buyers, as opposed to sellers, I suggest that buyers sign a short sale addendum, which contains a date that is 120 days out.

Some home buyers believe they can demand that the lender quickly respond to their offer. It’s not gonna happen. Threats don’t work. There is a procedure for the short sale process and, along the way, it can get delayed for reasons out of the listing agent’s control. Negotiators quit their jobs, they may become ill or misplace the file, or the PSA, worried over its tax-exempt status, could issue autocratic ultimatums, which then require further negotiation.

The key is patience. Buyers who wait for short sale approval generally receive it. That’s evidenced by the growing number of short sales I am closing in Sacramento.

As for pricing, sometimes buyer’s agents do not look at the comparable sales or, if they do happen to glance at them, they can’t interpret them. In many cases, the short sale price a buyer sees advertised is not the real price. Because unless the bank has already issued approval, known as an approved short sale, it’s up to the bank to select the price. And that price is based on comparable sales. Knowing what the bank is likely to accept is not really a big secret or a scary, unknown factor.

An agent called me a few days ago, asking about the price her buyer may need to offer to get that short sale offer accepted. I suggested she look at the comps, because that’s where the answer is, staring her right in the face. She argued that some of the homes in that neighborhood sold for less than my seller’s sales price and the square footage of those homes were larger. Therefore, she concluded, our short sale price was too high, and she believed her buyers should offer less than asking.

Did she happen to note that a few homes with identical square footage and upgrades as the subject property recently sold for $25,000 more? I guess her eyes wandered all over those comps instead of zeroing in on the exact models. It’s like this, say you’ve got 3 red apples and 12 green apples for comps. The home you want to buy is a red apple. Which is a comparable sale? A green apple or a red apple? Which homes do you think the short sale bank will use as comparable sales?

—

Elizabeth Weintraub is an author, home buying columnist for The New York Times-owned About.com, a Land Park resident, and a Land Park real estate agent who specializes in older, classic homes in Land Park, Curtis Park, Midtown and East Sacramento. Weintraub is also a Sacramento Short Sale agent who lists and successfully sells short sales throughout Sacramento. Call Elizabeth Weintraub at 916.233.6759. Put 35 years of real estate experience to work for you. DRE License # 00697006.

The Short Sale Savior, by Elizabeth Weintraub, available through bookstores everywhere and at Amazon.com.

Photo: Unless otherwise noted in this blog, the photo is copyrighted by Big Stock Photo and used with permission.