Chances of buying an REO or short-sale without 20% down?

[Scarlett]

[quote=esmith]I think you’re conflating three issues. 1) Can you get a mortgage with 10% down? 2) Will the bank agree to sell you the house with 10% down? 3) Is it wise to start shopping for a house if you only have enough money for 10% down?

1) Yes, but it will be more expensive than if you put 20% down. [/quote]
Thanks, esmith!

That depends, of course, – in the sense that if one has more than 10% to put down, and if he prefers to invest some of it, instead of putting everything for a downpayment, it may actually pay off, or at least be a safer investment, in case the prices drop further (which looks almost a certainty right now).

[quote=esmith]
(…)
3) Probably not – houses are still going down – it’s possible that your house will drop 10% and wipe your down payment. Don’t spend your last dime on the down payment.[/quote]

No, I wouldn’t spend my last dime, and probably I wouldn’t be getting a good loan deal if I did. But saving another 10% down payment or 50-60K may take years and years, realistically (in my case). In the mean time, with kids, it’s nice to have a larger house & yard while they are still young. I didn’t mean that I would buy something right away, but perhaps in the next year or two – hopefully by then the prices would have reached their last/bottom leg in areas I am looking.

[Scarlett]

[quote=urbanrealtor]Thats most of my clients right now.

Good credit, good pay, but low savings (like 5-10 percent).

Not always the best position to get low offers accepted but totally reasonable.
(…)
The shorts seem to only care that they have a patient buyer (I am listing a few) and that the lender is legit.

If you have more detailed questions (like too detailed for a thread), you can also email. Its my handle at gmail.
[/quote]

Aha, I was wondering how many are in my situation…I knew some of my friends were…
Thanks, Urbanrealtor! I may contact you in the future.

In short sales succes stories with <20% down, what was crucial factor for success? For example, the speed at visiting the property after it hit the MLS & making a decision & offer - how long was that? Other factors (beside the pre-approval with a serious lender)?

[Scarlett]

[quote=urbanrealtor]Thats most of my clients right now.

Good credit, good pay, but low savings (like 5-10 percent).

Not always the best position to get low offers accepted but totally reasonable.
(…)
The shorts seem to only care that they have a patient buyer (I am listing a few) and that the lender is legit.

If you have more detailed questions (like too detailed for a thread), you can also email. Its my handle at gmail.
[/quote]

Aha, I was wondering how many are in my situation…I knew some of my friends were…
Thanks, Urbanrealtor! I may contact you in the future.

In short sales succes stories with <20% down, what was crucial factor for success? For example, the speed at visiting the property after it hit the MLS & making a decision & offer - how long was that? Other factors (beside the pre-approval with a serious lender)?

[Scarlett]

[quote=urbanrealtor]Thats most of my clients right now.

Good credit, good pay, but low savings (like 5-10 percent).

Not always the best position to get low offers accepted but totally reasonable.
(…)
The shorts seem to only care that they have a patient buyer (I am listing a few) and that the lender is legit.

If you have more detailed questions (like too detailed for a thread), you can also email. Its my handle at gmail.
[/quote]

Aha, I was wondering how many are in my situation…I knew some of my friends were…
Thanks, Urbanrealtor! I may contact you in the future.

In short sales succes stories with <20% down, what was crucial factor for success? For example, the speed at visiting the property after it hit the MLS & making a decision & offer - how long was that? Other factors (beside the pre-approval with a serious lender)?

[Scarlett]

[quote=urbanrealtor]Thats most of my clients right now.

Good credit, good pay, but low savings (like 5-10 percent).

Not always the best position to get low offers accepted but totally reasonable.
(…)
The shorts seem to only care that they have a patient buyer (I am listing a few) and that the lender is legit.

If you have more detailed questions (like too detailed for a thread), you can also email. Its my handle at gmail.
[/quote]

Aha, I was wondering how many are in my situation…I knew some of my friends were…
Thanks, Urbanrealtor! I may contact you in the future.

In short sales succes stories with <20% down, what was crucial factor for success? For example, the speed at visiting the property after it hit the MLS & making a decision & offer - how long was that? Other factors (beside the pre-approval with a serious lender)?

[Scarlett]

[quote=urbanrealtor]Thats most of my clients right now.

Good credit, good pay, but low savings (like 5-10 percent).

Not always the best position to get low offers accepted but totally reasonable.
(…)
The shorts seem to only care that they have a patient buyer (I am listing a few) and that the lender is legit.

If you have more detailed questions (like too detailed for a thread), you can also email. Its my handle at gmail.
[/quote]

Aha, I was wondering how many are in my situation…I knew some of my friends were…
Thanks, Urbanrealtor! I may contact you in the future.

In short sales succes stories with <20% down, what was crucial factor for success? For example, the speed at visiting the property after it hit the MLS & making a decision & offer - how long was that? Other factors (beside the pre-approval with a serious lender)?

[SD Realtor]

My thoughts are that if your offer is the highest of all the offers out there then it does stand a good chance of being accepted, especially for an REO. I have an all cash buyer who has been outbid on a few homes already for REO properties in Eastlake by non all cash buyers. If the difference is only a few thousand then of course you are in peril. For shorts your position is weaker because when you submit your offer you may be the highest amount but while the processing is getting done another offer can come in at your bid amount and if they have less financing then they will more then likely get the nod.

I agree with UR in that people are still out there buying with 10% down.

I am not sure I agree with that concept but it is indeed happening. Also you may not have to save another 10% to get to 20% down. Maybe you need to save 5% and housing prices drop another 5% and then you have made it.

I know with kids and a family it is hard to be patient especially if it means another year or two.

[SD Realtor]

My thoughts are that if your offer is the highest of all the offers out there then it does stand a good chance of being accepted, especially for an REO. I have an all cash buyer who has been outbid on a few homes already for REO properties in Eastlake by non all cash buyers. If the difference is only a few thousand then of course you are in peril. For shorts your position is weaker because when you submit your offer you may be the highest amount but while the processing is getting done another offer can come in at your bid amount and if they have less financing then they will more then likely get the nod.

I agree with UR in that people are still out there buying with 10% down.

I am not sure I agree with that concept but it is indeed happening. Also you may not have to save another 10% to get to 20% down. Maybe you need to save 5% and housing prices drop another 5% and then you have made it.

I know with kids and a family it is hard to be patient especially if it means another year or two.

[SD Realtor]

My thoughts are that if your offer is the highest of all the offers out there then it does stand a good chance of being accepted, especially for an REO. I have an all cash buyer who has been outbid on a few homes already for REO properties in Eastlake by non all cash buyers. If the difference is only a few thousand then of course you are in peril. For shorts your position is weaker because when you submit your offer you may be the highest amount but while the processing is getting done another offer can come in at your bid amount and if they have less financing then they will more then likely get the nod.

I agree with UR in that people are still out there buying with 10% down.

I am not sure I agree with that concept but it is indeed happening. Also you may not have to save another 10% to get to 20% down. Maybe you need to save 5% and housing prices drop another 5% and then you have made it.

I know with kids and a family it is hard to be patient especially if it means another year or two.

[SD Realtor]

My thoughts are that if your offer is the highest of all the offers out there then it does stand a good chance of being accepted, especially for an REO. I have an all cash buyer who has been outbid on a few homes already for REO properties in Eastlake by non all cash buyers. If the difference is only a few thousand then of course you are in peril. For shorts your position is weaker because when you submit your offer you may be the highest amount but while the processing is getting done another offer can come in at your bid amount and if they have less financing then they will more then likely get the nod.

I agree with UR in that people are still out there buying with 10% down.

I am not sure I agree with that concept but it is indeed happening. Also you may not have to save another 10% to get to 20% down. Maybe you need to save 5% and housing prices drop another 5% and then you have made it.

I know with kids and a family it is hard to be patient especially if it means another year or two.

[SD Realtor]

My thoughts are that if your offer is the highest of all the offers out there then it does stand a good chance of being accepted, especially for an REO. I have an all cash buyer who has been outbid on a few homes already for REO properties in Eastlake by non all cash buyers. If the difference is only a few thousand then of course you are in peril. For shorts your position is weaker because when you submit your offer you may be the highest amount but while the processing is getting done another offer can come in at your bid amount and if they have less financing then they will more then likely get the nod.

I agree with UR in that people are still out there buying with 10% down.

I am not sure I agree with that concept but it is indeed happening. Also you may not have to save another 10% to get to 20% down. Maybe you need to save 5% and housing prices drop another 5% and then you have made it.

I know with kids and a family it is hard to be patient especially if it means another year or two.

[Eugene]

[quote=Scarlett]
In short sales succes stories with <20% down, what was crucial factor for success? For example, the speed at visiting the property after it hit the MLS & making a decision & offer - how long was that? Other factors (beside the pre-approval with a serious lender)?[/quote]

I don't think that success with short sales depends at all on the amount you put down.

If you want to get a short sale, you need to make an offer that is low enough for you to like and high enough for the bank to approve, and you need to stick around long enough for your offer to make it through the system.

[Eugene]

[quote=Scarlett]
In short sales succes stories with <20% down, what was crucial factor for success? For example, the speed at visiting the property after it hit the MLS & making a decision & offer - how long was that? Other factors (beside the pre-approval with a serious lender)?[/quote]

I don't think that success with short sales depends at all on the amount you put down.

If you want to get a short sale, you need to make an offer that is low enough for you to like and high enough for the bank to approve, and you need to stick around long enough for your offer to make it through the system.

[Eugene]

[quote=Scarlett]
In short sales succes stories with <20% down, what was crucial factor for success? For example, the speed at visiting the property after it hit the MLS & making a decision & offer - how long was that? Other factors (beside the pre-approval with a serious lender)?[/quote]

I don't think that success with short sales depends at all on the amount you put down.

If you want to get a short sale, you need to make an offer that is low enough for you to like and high enough for the bank to approve, and you need to stick around long enough for your offer to make it through the system.

[Eugene]

[quote=Scarlett]
In short sales succes stories with <20% down, what was crucial factor for success? For example, the speed at visiting the property after it hit the MLS & making a decision & offer - how long was that? Other factors (beside the pre-approval with a serious lender)?[/quote]

I don't think that success with short sales depends at all on the amount you put down.

If you want to get a short sale, you need to make an offer that is low enough for you to like and high enough for the bank to approve, and you need to stick around long enough for your offer to make it through the system.

[Author]

Posts