What is a Short Sale?
A short sale is real estate transaction where the total purchase price is less than the loan amount due on the home. Rather than take the home back in a foreclosure, many lenders agree to reduce the principal loan amount due if the borrower has demonstrated to the lender a qualified financial hardship. In these scenarios, the lender is agreeing to accept a short pay, hence the term short sale.
What is a Zetabid "Certified Pre-approved Short Sale"?
Zetabid Pre-approved Short Sales are homes for sale with the full cooperation of the lender and the seller. The lender and the seller have agreed to sell the home at the an agreed upon market list price. This agreement between the lender and the seller is forged before the home is listed for sale, placed on Zetabid.com, featured in Zetabid advertising, or available on other websites. Unlike traditional short sales, Zetabid pre-approved short sales do not require lengthy waiting periods for lender approvals. With Zetabid short sales there are no contingencies for lender approval of the sales price. Your offer can be accepted on the spot by the seller because the lender approval of the short pay has been acquired prior to the home being listed for sale and placed on the market.
To qualify as "Certified" by Zetabid, each home has been investigated and in compliance with the following items prior to the home being listed on the market:
- Home valuation (multiple agent prepared valuation reports plus seller and lender price approval)
- Title (full title report review)
- Financing availability (home screened for conventional financing availability)
- Junior lien payoffs (junior lien holders such as home equity lines have pre-approved the short payoff)
Zetabid Certified homes are the easiest and hassle free short sale transactions a buyer could close because we do the work up front.
I have heard short sales are difficult to close
Traditional short sales require complex documentation and lengthy dialog between the seller and the lender. Buyers are typically forced to wait in escrow (with a large deposit held) for the lender approval or denial, which can take 60 to 90 days. This is a huge risk as other homes may come on the market that can be purchased under normal terms without any lender approval that a buyer may miss the opportunity.
Since Zetabid Certified Pre-Approved Short Sales are pre-approved by the lender, there is no waiting time.
My Agent tells me not to bother looking at Short Sale listings
Many agents have never closed a short sale transaction. They may have experienced a traditional short sale transaction that took a long time to close and paid reduced real estate commissions. That is precisely why the Zetabid Pre-Approved Short Sale program partners with the lender to pre-approve the sale price and the commission BEFORE the home is placed on the market.
Ask your agent to show you these Zetabid Pre-Approved Short Sale homes because there is no waiting time and your agent's commissions are protected.
How can I place an offer?
You can start an offer online using the ‘Start an Offer’ button on the property detail page, or you can submit a written offer with your agent. If you do not have an agent, you can contact the Zetabid Pre-Approved Short Sale listing agent on the property details page to start a written offer on your behalf. We use the standard state association of Realtors contracts.
To submit a written offer you will also need ALL of the following:
- An Earnest Money Deposit check of 3% of the purchase price AND
- Pre-approval letter from a designated lender
Real Estate Agents click here for full instructions on submitting an offer on the CAR RPA Purchase Agreement Form.
What is the "Make an Offer" link?
The property details page features a “Make an Offer” link. This link allows you to start a purchase offer on a Zetabid short sale property. Simply complete the 1 page bid form online, press “submit” and your non binding offer will be sent to the property’s listing agent. If the seller wishes to accept the offer, Zetabid or the listing agent will contact you and request you to provide a fully executed purchase agreement, copy of your loan pre-approval letter and Earnest Money Deposit. Once contracts are signed by you (the buyer) and the seller, the property will be removed from the market and escrow opened.
Are there any liens on the properties?
No. The sellers provide insurable title for all properties and clear title is a contingency to close. You will receive a CLTA owner’s policy of the title insurance in the amount of the purchase price as part of your transaction. The premium for the owner’s title policy is paid for by the seller. You, the buyer, are responsible for the cost of any lender’s policy. Please review the purchase agreement or
contact us for further details.
Should I get pre-qualified/approved before I write an offer?
Yes, it is required. Reviewing your financing options prior to selecting a home to buy is important. In order to buy with confidence, every buyer should be pre-qualified for any financing before submitting an offer. Please call 1-888-4Zetabid (888-493-8224) to obtain the designated lender’s phone number. You will receive a 21 day loan contingency with a qualified pre-approval letter from a direct lender. Rates vary by lender and by individual borrower financial information.
What if I want to use my own lender?
You are welcome to use your own lender, in which event you should obtain a pre-approval letter (not a pre-qualification) to present with your offer. Failure to achieve loan approval and close the transaction within the specified time frame may result in the forfeiture of the buyer’s Earnest Money Deposit in accordance with your purchase contract. We encourage you to utilize the Zetabid designated lenders because the purchase contracts require a 45 day closing time frame, which many outside lenders cannot meet.
When will the transactions close?
The closings are expected to occur within 45 days of the acceptance. At closing and upon payment of the purchase price and closing costs, you will receive insured title to the property. Please view the Short Sales Terms and Conditions and purchase contract available on the property details page of your desired home for more information or
contact us with questions.
What is the Earnest Money Deposit?
The Earnest Money Deposit is the amount of money a buyer must deposit with the escrow agent upon acceptance. The Earnest Money Deposit is equal to 3% of the Total Purchase Price, regardless of the amount you finance. This is not the down payment. For example, if the Total Purchase Price is $300,000 then the Earnest Money Deposit required is $9,000 ($300,000 x 3% = $9,000). The Earnest Money Deposit may be forfeited if you do not close the transaction.
Can I conduct inspections?
Yes, all contracts will provide a five (5) day physical inspection contingency. No repair allowance will be given and any attempt to re-negotiate the price based on repair costs after the five day period may result in forfeiture of the Earnest Money Deposit.
What information do I need to provide for an "all-cash purchase?"
You must provide proof of funds in a recent bank or asset statement showing the funds available in the account in which you will be using to finance the purchase. No cash or credit cards will be accepted at closing.
What if I want to sell my home with your program?
This program is only available through certain lenders who we have contractual relationships with to provide this short sale program. Our program is very unique and offers qualified sellers significant moving advances in cash at closing, less severe credit reporting versus foreclosure, comprehensive home marketing including MLS (no short sale designation), yard sign, print advertising, email marketing, and internet advertising (Realtor.com, etc.). Additionally, because our transactions are performed with the full cooperation of your lender, the foreclosure sale (trustee sale) is postponed while your home is in our 60 day program reducing the stress of a traditional short sale. All closing costs are paid by the lender and most of our lenders have agreed to waive any deficiency claims in the future (many short sales require the borrower to sign a promissory note for the difference between price and your loan amount). To learn more please call 310-376-5125. Even if your lender is not part of our program, we may be able to assist you.