Are you looking to buy a new Atlanta home? Are you thinking that now’s a great time to find bargains? Before you make an offer, it pays to know a little about the seller’s situation.
If a home is being sold for less than the current homeowner owes on the property and don’t have sufficient funds for the difference, then closing will be considered a short sale. Many more Atlanta homeowners are finding themselves in this situation due to a number of factors, including job losses, aggressive borrowing against their home in the days of easy credit, and declining home values in a slower real estate market.
Don’t confuse a short sale with a foreclosure. A foreclosure is when the seller’s lender has taken title of the home and is selling it directly. Homeowners often try to accomplish a short sale in order to avoid foreclosure. But a short sale holds many potential pitfalls for buyers. Know the risks before you pursue a short-sale purchase.
I always preach to potential Atlanta home buyers, that you are a good candidate for a short sale if:
- You’re patient. Short sales do not function like normal resales in the sense that they can take a lot longer to close. You’re not just entering into an agreement with the seller, but the seller’s lender must also agree to receiving less than they are owed. And if there are two lenders involved, it can take longer.
- Your financing is ready to roll. Lenders always prefer cash offers, but most short sales are still financed. It’s important to show you are well qualified and your financing is pre-approved.
- You’re flexible on timing don’t have any contingencies. If you have a home to sell before you can close on the purchase of the short-sale property-or you need to be in your new home by a certain time-a short sale may not be for you. Lenders prefer offers with no contingencies and flexible closing terms.
If you’re serious about purchasing a short-sale property, it’s important for you to have expert representation. A Certified Distressed Property Expert (CDPE) has been trained on working with distressed sellers, home buyers and most importantly, the banks.
You may have a close friend or relative in real estate, but if that person doesn’t know anything about short sales, working with him or her may hurt your chances of a successful closing.
A Realtor holding the CDPE designation will be able to show you short-sale homes, help negotiate the purchase when you find the property you want to buy, and smooth communications with the lender.
But if you’re patient, flexible and pre-approved for your financing, you may want to consider purchasing a short sale. Most Atlanta short sales are in very good condition and can be purchased at a discount to the market. Contact us today to learn more about short sales and whether they may be a good fit for you.
Read more articles about Foreclosures and Short Sales
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