Tuesday, June 12, 2018 / by Janet Love
Real Estate Corner…
Q. Should I Buy a Short Sale Property?
A. In a short sale, a buyer pays less than the amount a seller owes the lender. When home values are dropping, homeowners might find they owe more on their mortgage than their home will sell for. In these cases, lenders will sometimes accept less than the amount owed on the home, assuming the homeowners don't have other assets that can be sold.
The question you have to ask yourself is: Are you really getting a great deal? If the house was purchased at the peak of rising home values, the homeowners might have paid a premium price for the property. If values are dropping, the lender may only be able to discount the property to current market values, so you wouldn't be getting a bargain at all.
Here Are Some Short Sale Tips:
- Know what similar houses on the market are selling for ask your buyer agent to provide a comparative market analysis.
- Find out how long the home has been on the market, are there any submitted offers to the lender and make sure you get good inspections. While you buy a short sale home as is, you want to know if there are any major problem areas. You'll have a 10 day inspection that allows you to back out if something was found beyond your expectations to repair or replace. A seller in financial trouble often can't keep up with repairs.
- Remember short sales take more time, every lender is different, some will be looking for a better deal than a short sale and others short sales can have two lenders taking more time to get to review and approve the short sale.
- Make sure you have an attorney experienced in this sort of sale who can aid you in reviewing any short sale lender documents.
- Make sure you have an experience REALTOR who understands the ins and outs of a short sale and can intervene on your behalf to ensure you have a good position when you make an offer and who can help with inspection repairs.
- Some short sale listings can have multiple offers, if you're a buyer be aware lenders require short sale listing agents to continue presenting offers if they are equal to or higher than the current submitted offer and it is their fiduciary responsibility to continue doing so until the lender has approved an offer.
If you have questions about short sales, or need capable and trustworthy representation, please call me Dave Zajdzinski at 480-332-6468 or email email@example.com, I am a short sale qualified and trained expert!