That part is easy. The question really is "How to get the appraised value or BPO to match your purchase contract for your preforeclosure short sale that you have already submitted to the bank".
Banks depend on BPO's in Pre Foreclosure Real Estate
You figure out a fair price that you want to pay for the pre foreclosure house. You put the number on your purchase contract. Your buyer grumbles and you explain to them you can always go up but you can never go down on your offer. And you don't expect them to pay the difference. You want to start low and listen to what the bank will accept. They say OK and sign your documents.
You get back to your office and put together your short sale packet with all the back up documentation to demonstrate your offer is a good, as-is condition offer. You believe the bank will accept it. Then the bank says they will be sending out an independent appraiser or BPO (Broker's Price Opinion) to determine the current as-is condition of the house. The bank wants a third party to verify your offer. Ugh. You thought you were done.
How can you ethically influence the outcome of the appraisal or BPO in your pre foreclosure house offer?
If the roof doesn't leak, you DON'T say the roof leaks. You have to figure out what really is wrong with the house.
Paint, carpet, new windows, furnace, how about updated electric? They are all fine. How about crime stats? Are there a lot of break-ins in the area? Are there a lot of other vacant houses in the area? Any houses boarded up?
Is this an area where the copper might get stolen out of the house? What about the foundation? Are there cracks, any movement, water damage? Are the sidewalks tilted TOWARD the house to cause water problems, mold or mildew?
What about dog or cat urine odor in the carpet? You are looking for things wrong with the house and why the bank would not want it back. These are all great reasons and your skills in negotiating a short sale now come into play.
Will the banks always negotiate a short sale?
Don't get me wrong, sometimes the banks just won't negotiate. They are mitigating their losses - chosing the solution that will have them lose the least amount of money. Sometimes it may be the foreclosure sale and a preforeclosure sale just may not be in the picture.
Other convincing arguments
I once faxed a page of the newspaper to the bank of a map that had a dot for every murder in the city for that year. As luck would have it, I got the house pretty cheap cause there was a dot right down the street from my house. I'm still not sure if that is a good or bad thing.
I have also faxed a letter from the Chief of Police. It said that the house I wanted to short sale had been used for surveillance on drug rings. In front of this house was an "open air drug corner" and this devalued the whole neighborhood. The bank totally stopped the foreclosure.
Whatever data you have to demonstrate the house isn't worth what is owed and you are offering a fair market as-is value of the house will go a long way to getting your appraisal or BPO to match your price on the purchase contract.
Give most of this data to both the Loss Mitigator at the bank and the appraiser! Hold some data back for use later while you're negotiating a short sale. And don't accept "no" for an answer.
