A short sale is one in which a seller owes more on the property than what it is going to be purchased for. As a result, not only does the seller need to agree to the sale, but so does the current lender. The process is quite lengthy for many reasons, but can have a positive result in that a buyer has the opportunity to make a purchase below current market value.
I hear of people who shy away from short sales, but in my opinion, they simply provide another approach to buying or selling real estate. While they're worth consideration, they also test our negotiation skills, patience and professional tenacity. A recent experience proves a perfect example.
I met with one of my clients who thought she was priced out of buying a home. So we looked at short sales. It didn't matter how long the purchase would take, it was more about having the right place at the right price.
Month 1: We make an offer on a property and wait, wait, wait.
Month 2: Another offer - with a higher offer price - is submitted by another buyer. We think our deal is dead and search on.
Month 3: We write an offer on another short sale. With all this waiting my client is losing enthusiasm.
Month 4: We hear from the listing agent of the second property that they don't think our offer is going to be enough for the lender and that they are going to submit an offer from another buyer.
Month 5: We are back to the drawing board. Our patience is being tested, and my client starts to think that it wasn't meant to be.
Month 6: We get a call from the listing agent of property number 1 that the buyer with the higher offer can't be found and we are being asked if we are still interested. Amazing! My client can't believe it!
Month 7: My client, a woman who started off thinking she could never buy a home, moves in. She did not have to change her expectations - she simply had to be patient.
It was a lengthy process, but it felt good in my heart that I helped this person.
Short sales may not be right for everyone, but don't rule them out. Here in San Mateo, Pacifica and the San Francisco Peninsula, short sales will, for better or worse, be here for a while.
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