Borrowers are obligated to mitigate lenders’ losses

Borrowers are obligated to mitigate lenders’ losses
Date Published: December 6, 2013

Dear Sue,
Due to personal reasons I was forced to put my home on the market as a short sale.
The first week it was on the market I received six offers.
My agent said that she priced it conservatively in order to get multiple offers.
Here’s the issue. I really liked a particular family and would like them to be the buyer of my house.
My agent said that I cannot accept the offer because it was not as high as some of the other offers.
I have a problem with this because I really like the buyer. I think they’re the perfect buyer for my wonderful home.
Since I still own the home and the bank doesn’t, shouldn’t I be able to pick my own buyer regardless of the offering price?
~ Upset Alice

Dear Alice,
I totally understand wanting the right buyer for one’s home.
In an equity sale you would have complete control over which offer you accepted.
Unfortunately you’re in a short sale and your lender is going to be taking a loss. The lender made the loan in good faith and you as the borrower have an obligation to mitigate that loss as much as you possibly can.
The way to accomplish that is by accepting and submitting the highest and best offer, keeping in mind that the highest is not always the best.
If your goal is to sell your home to the family with the lower offer try giving them an opportunity to amend their offer. They may qualify and be willing to pay a higher price.
The best strategy is to counter all of the offers asking for highest and best.
That gives each buyer a chance to better their offers. Who knows what the offers will look like?
Doing what you can to mitigate your lenders’ loss is a matter of good Home $$$s and Sense.

Dear Sue,
I live in south Placer County and plan on downsizing. I have owned my home for over 30 years and am happy with a relatively low property tax assessment. I want to sell and move closer to Auburn but I want to be smart about it.
I heard through a friend of mine that the Placer County tax assessor will allow one to move their tax base to a new property. Is this true? How do I find out about it?
~ Downsizing Dan
Dear Dan,
Your friend is talking about proposition 60. The proposition allows one to transfer their tax base year values within the same county. Proposition 90 allows transfers from one county to another. It is the discretion of each county to allow transfers and not every county will.
There are several eligibility requirements. The main ones are that you or a spouse must be 55 years old when the original property is sold. The replacement property must be your principal residence and of equal or lesser value than the the sold property.
Call the assessor’s office for details!
Sue Thompson is the owner of HomeTown Realtors in Auburn. She can be reached at seesue@mac.com, or at www.homedollarsandsense.com.