How to Convince a Short Sale Bank to Pay For Repairs

You might think the bank cares about the condition of the home, but the bank does not. The bank cares about getting its mortgage payments and, in the event of a short sale, getting market value for that home. Here are a few reasons why the bank is likely to reject a request for repairs:

• The bank doesn’t want to lose money on the sale.
• The bank agreed to sell in “as is” condition.
• The bank doesn’t need to accept the short sale when it can instead foreclose.
• If the home goes back on the market, the next buyer might not squabble about the repairs.
• The seller doesn’t have any money to make the repairs.

Sometimes short sale homes are vandalized while the buyers wait for short sale approval especially if the home is vacant. For example, I had a short sale listed in Roseville that was vacant. Thieves swiped the AC unit from the side yard and ripped out the electrical panel. The buyer could have persuaded the bank to lower the price if the buyer had not become greedy. The buyer asked for a credit equal to 4 times the amount of the repair, so naturally, the bank rejected the short sale offer. Click here to know more about home buyers.

Here is the procedure to increase the odds that the bank will pay for repairs on a short sale:

• First, make sure the repair is serious. Don’t ask the bank to repair little items.
• Present a case as to why you didn’t ask for the repair in the initial offer.
• Obtain at least 3 bids from recognized professionals and submit with your request.
• Realize that if the bank approves the repair, it will choose the lowest bid.
• Request an extension to close the short sale if the repairs are to be made prior to closing.
• Present your case, an executed addendum and the bids to the bank.
• Have a plan B in case the bank rejects the repairs.