Looking for short sale listings? Please visit my Short Sale listings page.
If you are considering buying a short sale property and want to learn what is involved, I hope
the answers to these frequently asked questions will be of assistance. Constant
communication between me as your real estate representative, the listing agent, and the
lender, is the key to a successful short sale transaction.
You can register for automatic updates from our MLS for short sales that meet your needs on
my Home Search page.
If you are considering buying a short sale property and want to learn what is involved, I hope
the answers to these frequently asked questions will be of assistance. Constant
communication between me as your real estate representative, the listing agent, and the
lender, is the key to a successful short sale transaction.
You can register for automatic updates from our MLS for short sales that meet your needs on
my Home Search page.
A short sale occurs when a property sells for a price that is insufficient to pay back the loan or
other liens against the property. The seller must prove financial hardship to their lender.
The seller's lender will not allow the seller to receive any proceeds or obtain any monetary
benefit as part of a short sale. They also will not allow the seller to make any repairs. A short
sale is usually as-is, subject to a home inspection by the buyer.
other liens against the property. The seller must prove financial hardship to their lender.
The seller's lender will not allow the seller to receive any proceeds or obtain any monetary
benefit as part of a short sale. They also will not allow the seller to make any repairs. A short
sale is usually as-is, subject to a home inspection by the buyer.
Let's look at the similarities first. Both require the use of an "as-is" purchase contract (see the
Document Center). You will be required to buy the property "as-is" with right to inspect, and
proceed with the sale if there are no major material defects.
Both short sales and foreclosures are considered distressed properties, and short sale
lenders often use comparable foreclosed properties to arrive at a sales price.
Short sales usually are currently occupied and more often than not, are better maintained than
a foreclosure.
Foreclosure properties have no seller disclosure as to condition. Since the majority of short
sale properties are occupied, the current owner will be able to provide a common seller's
disclosure. If you are buying from long distance, this can make your decision easier.
However, with a short sale, there's no guarantee the seller will receive approval of the sale
from their lender at a price that makes sense in the current market. Each lender has it's own
requirements to qualify for a short sale. Most will not allow sellers to pay for repairs to the
home or issue repair credits.
Document Center). You will be required to buy the property "as-is" with right to inspect, and
proceed with the sale if there are no major material defects.
Both short sales and foreclosures are considered distressed properties, and short sale
lenders often use comparable foreclosed properties to arrive at a sales price.
Short sales usually are currently occupied and more often than not, are better maintained than
a foreclosure.
Foreclosure properties have no seller disclosure as to condition. Since the majority of short
sale properties are occupied, the current owner will be able to provide a common seller's
disclosure. If you are buying from long distance, this can make your decision easier.
However, with a short sale, there's no guarantee the seller will receive approval of the sale
from their lender at a price that makes sense in the current market. Each lender has it's own
requirements to qualify for a short sale. Most will not allow sellers to pay for repairs to the
home or issue repair credits.
The process has gotten much more streamlined as foreclosure activity is slowing down.
Lenders require sellers to provide very detailed financial and personal information that can
take a lot of time to collect and then analyze. Lenders may also perform an appraisal.
Closing/title companies and real estate attorneys have created an industry negotiating with
banks to get a quicker resolution on accepting short sale prices. Some of these negotiators
are better than others. What used to take months can take as little as 6 to 8 weeks, especially
with larger banks like Bank of America..
Lenders require sellers to provide very detailed financial and personal information that can
take a lot of time to collect and then analyze. Lenders may also perform an appraisal.
Closing/title companies and real estate attorneys have created an industry negotiating with
banks to get a quicker resolution on accepting short sale prices. Some of these negotiators
are better than others. What used to take months can take as little as 6 to 8 weeks, especially
with larger banks like Bank of America..
The biggest point is that because the short sale may take several weeks, it is important that
we include provisions in your offer that limit the time that the seller may have to obtain
approval for the sale from their lender (see the Document Center). We should also include
an addendum about how the seller handles other offers on the property.
Some short sale negotiators, hired by the seller, ask that you as a buyer pay them a fee for
their service. I recommend against this. The seller hired them, the seller should pay them.
However, as a buyer you will benefit by the sellers offering to pay some of your closing costs
in exchange for using their short sale negotiating team to close the sale.
You will also want to have a letter from your lender showing clearly that you are qualified to
purchase a property in the sales price range. This is different from a pre-qualification letter.
The seller's lender wants to know that you are 100% approved to buy the property before
considering your offer.
If there are past due HOA fees or any kind of lien against the property, the seller's lender is
responsible for payment, and will convey clear title to you at closing.
I work with a local lender and real estate attorney as part of my short sale services here on my
Service Providers page.
we include provisions in your offer that limit the time that the seller may have to obtain
approval for the sale from their lender (see the Document Center). We should also include
an addendum about how the seller handles other offers on the property.
Some short sale negotiators, hired by the seller, ask that you as a buyer pay them a fee for
their service. I recommend against this. The seller hired them, the seller should pay them.
However, as a buyer you will benefit by the sellers offering to pay some of your closing costs
in exchange for using their short sale negotiating team to close the sale.
You will also want to have a letter from your lender showing clearly that you are qualified to
purchase a property in the sales price range. This is different from a pre-qualification letter.
The seller's lender wants to know that you are 100% approved to buy the property before
considering your offer.
If there are past due HOA fees or any kind of lien against the property, the seller's lender is
responsible for payment, and will convey clear title to you at closing.
I work with a local lender and real estate attorney as part of my short sale services here on my
Service Providers page.
You can begin by searching short sale listings on my website. You can also get updates
automatically for short sale listings that meet your needs. The best properties go fast!
If you are an investor, you may find my real estate return on investment calculator handy.
Whether buying or selling, we'll look at comparables, including nearby distressed property
sales. I can help guide you through the process.
automatically for short sale listings that meet your needs. The best properties go fast!
If you are an investor, you may find my real estate return on investment calculator handy.
Whether buying or selling, we'll look at comparables, including nearby distressed property
sales. I can help guide you through the process.
| Download the following PDF files for more short sale information: |
make an offer
mls number search
interactive school map
florida homestead
rental ROI calculator
I gave an answer on Trulia which was voted the best answer on short sales. Realistic
expectations for buying a short sale means that an offer to purchase does not automatically
result in an agreement and a closing.
expectations for buying a short sale means that an offer to purchase does not automatically
result in an agreement and a closing.
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