What does this mean:Listing price may not be sufficient to cover all encumberances, closing costs?

Question

FULL PHRASE BELOW!!

Listing price may not be sufficient to cover all encumberances, closing costs, or other seller charges and sale of property at full listing price may be conditioned upon approval of third parties.

please advise what do I do? I want to put an offer but I am confused on these details.

Answer 1

Sounds like a short sale.  The seller is trying to sell before they get foreclosed on.  Their lender is the third party involved that will have to approve of any offer of less than the amount of the loan.  If you bid on this property be sure to include verbiage that requires the seller to provide clear title at closing, and be sure to get title insurance.  There could be mechanic's liens from people who have done work on the property or some other judgment against the house (taxes or levy from the city/county).

Be aware that it often takes months to get a response from the sellers lender.  No matter when you state that the offer expires, the lender will respond or not respond in their own sweet time.  

Answer 2

You can assume this language to mean that the property has liens/mortgages which exceed the value of the asking price.  Translate that to mean you need to be careful in purchasing, in that you must insist that all such liens are fully cleared before you close on this property.

Answer 3

1. probablee a forkloesed hous with morgage balans > pries hous kan sell at.  Or bank threten tu forkloes & oener tri tu sell at pries bank will agree tu.  A pries weer bank luze munee.

Answer 4

This sounds like they are trying to tell you they will be attempting a compromise or short sale.  This means the seller will be submitting any offer to his mortgage company and asking them to clear the title for less than full repayment of their mortgage note.

This happens often now days but it is a frustrating process and you need to be rady for a long and confusing delay.

Answer 5

It's a short sale. That means you make your offer to the seller. If the seller accepts, then the contract is contingent upon approval by the lender.

Short sales take a long time, usually. They're often very frustrating (lack of communication from the lender to the listing agent), and frequently aren't completed. The lender sometimes lets the home be foreclosed upon, rather than accepting a short sale.

Work with an experienced Realtor who knows and understands short sales. And hope that the listing agent (who is really the key to your chances of a short sale getting approved) knows what he/she is doing.