Is a Short Sale Right for You?
The word “short sale” may be cringe worthy to some buyers but with the right information and professional help, it can be a great way to get a discounted home.
The Long And Short Of It
A short sale, also known as a pre-foreclosure, is when a homeowner sells their home for less than what the mortgage balance is. The lender has agreed to accept less than what the homeowner owes them. It is an alternative to foreclosure but can still negatively affect a seller’s credit. A financial hardship is one of the most common reasons a seller would choose a short sale.
Transactions for short sales can be very slow due to the complex process of the transaction. Patience by far is the virtue to have when dealing with this type of sale. They can take a couple months or in some cases a year or two. If time is not on your side, short sales are not a good route to go for a new home.
Stay In The Know
Be aware of all seller disclosures on the house. Liens are one area to be informed in because they can make sales even more difficult. Some lenders will not approve a short sale if there are liens. Be sure to do a title search and save yourself the hassle of delay or in some cases termination of the sale.
Scope It Out
Short sales can often mean the buyer will be putting in more work than with a normal home. This is for not only the transaction but also with the actual repair work of the home. Short sale sellers in most cases are in a financial hardship and do not have the funds to maintain their home. Take a close look at the home and be sure to get a proper inspection (written by: Karen Highland) so no surprises end up on your lap after the sale.
Hire A Pro
One of the most important things that you can do to successfully purchase a short sale, is to hire a realtor experienced in them. Their knowledge and negotiation tactics are key to making the process run smoothly and quicker. Asking for referrals is an excellent way to ensure you have a good agent in this area of expertise!
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