When you see a home listed as a “Short Sale”, do you skip right over it because it seems to complicated? Or do you drool at the low price tag and wonder how you can buy it?
You have the questions … and we have the answers!!!
Simply put, a SHORT SALE is when the seller owes more on their home loan than the home is worth. Through a mutual agreement with the bank, they can sell the home and avoid foreclosure by listing their “underwater” home at a discount to buyers. While the seller can’t make any money off of the sale of the home, they CAN avoid bankruptcy, foreclosure, and a host of other nasty credit issues. The bank is usually happy to get a “bad” loan off their books, and the seller can walk away free and clear.
An APPROVED SHORT SALE means that the bank has agreed on a sale price of the property. A regular SHORT SALE means that further negotiations with the bank will be needed to complete the home purchase at the listed price.
Now. What does it take to snap up one of these discount properties?
1) PATIENCE. While first-time homebuyers can and do buy short-sale properties, it is important to note that the Short Sale process is completely different than a Regular Sale. An APPROVED SHORT SALE can take anywhere from 1-4 months to complete, while a regular Short Sale can take up to 4-8 months (or longer!). For this reason, if you are a first-time home buyer pursuing a short sale, or someone who is just about to sell their current property, TIME MUST BE ON YOUR SIDE, and your move-in time frame needs to be flexible. If you are looking to buy a property right away, have a firm move-out deadline or end-of-lease date, then a short sale is not for you. BUT, if you are a patient investor or have a flexible timeframe, a short sale can be the perfect option (and can save you a lot of money!).
2) PAPERWORK. If you are going to enter the world of short sales, be prepared for a more extensive paper chase. Remember — you aren’t just working with your own loan officer, you are also working with the seller’s bank as well. That means that you have to be ready to submit your paperwork multiple times to multiple banks. So if a short sale is in your future, get those financial records in order!
3) PROFESSIONALS. Short sales are not a for-sale-by-owner DIY sort of thing. Nor can just any realtor get the job done. Remember, Short Sales are a very specific kind of real estate negotiation, completely separate from regular real estate transactions. A majority of Realtors have never actually worked with a short sale, which is why they will often steer you towards other types of real estate transactions — even if that Short Sale is the perfect house for you! That’s why you’ll want to work with a Realtor that knows this complicated process inside and out, and has the persistence to see it through.
Here’s the GREAT NEWS. Redux Realty is one of the rare real estate teams that actually specializes in short sale transactions. In fact, we have completed OVER 100 SHORT SALE TRANSACTIONS!!!! The members of our team are tough, skilled negotiators who know every twist and turn of the short sale process. So whether you are thinking about listing your home as a short sale, or thinking of buying one for yourself, we not only CAN help — we WILL HELP — and would love to work with you.