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Alternate Realities: Spring Training and Buying Short Sales

Alternate Realities: Spring Training and Buying Short Sales

Let me set the scene for you.

(SURPRISE STADIUM, night. A spring training game drones on past the three-hour mark. Virtually every player with a real chance of making the roster of either club already has left the game, showered, and is on their way home. Suddenly, the visiting team rallies to take the lead in the top of the ninth.)

In the bottom of the inning the home team, we’ll call them the Rangers, comes to bat. And in the stands come the sounds of encouraging chatter from the fans … “Big hit, five-oh!” “Here you go, kid!” “Come on Rangers, tie it up, baby!”

For all intents and purposes it looks just like a real baseball game. Except …

There only are one or two regulars still in the game, the rest of the spots being occupied by players who will start the season in the minor leagues. At least one player on the field will be fortunate to have that fate and not be waived when the spring is over.

No one on either team wants to see the game go to extra innings. In fact, it’s highly unlikely that if the game gets tied up that there will be extra innings. One of the little secrets the average fan doesn’t know about spring training – it’s nearly all pitcher-driven. Each team has a set number of pitchers they want to work in a given game. They’ll also likely carry one or two “JICs” – short for “Just in Case” – should something to seriously wrong. Aside from that, though, pitcher A is going to work x number of innings, pitcher B will work this many and so on.

So when the pitcher’s struggling in the bottom of the ninth inning, failing to throw any pitch that doesn’t cause his catcher to spring up like a jack-in-the-box, and the pitching coach goes to the mound, there probably isn’t going to be a pitching change. In fact, the exchange probably was more along the lines of “throw a %@&^%#&^# strike or I’m sending you to Billings tomorrow.”

Since there are only a set number of pitchers, if the game’s tied after nine innings there’s a decent chance that’s how it will end. Especially in a rare, made-for-TV night game. And especially when 22 runs already have scored on 33 hits so far.

As I said, it looks like a real baseball game but it’s not …

And that, naturally, brings us to buying a short sale. The listing looks like a real listing but it isn’t. With a real listing, offering full price means you’re almost certainly going to buy that house. With a short sale, offering full price means nothing because the lender who is owed more than that listing price first has to decide what they are willing to accept, if anything.

There’s no requirement that a lender accept a short sale. Plain. Simple. End of story.

Sometimes those list prices have little to do with market value. Which would seem like a wonderful opportunity, until you remember the banks perform Broker Price Opinions – a fancy way of saying “run comps” to figure out what the home’s market value is. And it’s not often that a bank will give a home away for substantially less than market value on a short sale.

It looks like it’s a real listing, but it isn’t …

On most homes, once the seller has accepted an offer that’s the only offer in play. On a short sale, though, the sellers are able to continually accept second, third, whatever offers … sometimes they’re marked as such in the MLS, sometimes they aren’t. They look like active homes for sale, but they aren’t always …

Like a spring training game is pitcher driven, a short sale is lender driven. If the lender wants to take four weeks to respond to a short sale offer, that’s how long it will take. If the lender wants to take four months, that’s how long it will take.

Cash offers usually earn at least a lift of the eyebrow when submitted. On a short sale, the lender doesn’t much care whether the offer is cash or how quickly the buyer can and/or wants to close. The lender will take as long as the lender takes.

With a spring training game, the results don’t count in the regular season, none of the stats carry over and frankly no one remembers the details much past April 1. The only thing that remains are the bad things – such as the injuries, which are real as they get.

With a short sale, successful results rarely appear in the MLS because only 1 in 6 or so ever close. No one, especially not the lender, will remember the offers ignored once the house has gone into foreclosure. The only thing that remains are the bad things – the buyers who lost out on other opportunities chasing rainbows and the sellers who, after all that effort, were foreclosed on after all.

There are exceptions … a player can play themselves onto a roster, in which case the spring stats actually did matter. And short sales can result in a sale, leaving both buyer and seller happy.

Just don’t go to the park or a real estate agent’s office without realizing what you’re witnessing is a lot of fantasy that looks like reality.

1 Comment

  • Sage Dillon says:

    We have a lot of baseball talk going in our house, so this felt very timely. 🙂 Great analogy and important info for a buyer to know going in if they don’t want a broken heart.