I was showing homes to a couple from Georgia this week on the western side of San Antonio. We viewed properties for a couple of days and they found what they thought might be their next home. Aware that we were going to look at several "SHORT Sales" and foreclosed properties, I informed my buyer's that the property they "loved" was a "SHORT Sale" to which their initial response was "Great! We want to move in right away, the sooner the better!" Imagine their disappointment when I explained the true meaning of "SHORT Sale". Their initial response is what has inspired me to write this post.
What Is A "SHORT Sale"?
A short sale is a sale of real estate in which the proceeds from the sale fall "short" of the balance owed on a loan secured by the property being sold.
A short sale is typically executed to prevent a home from foreclosure, but the decision to allow a short sale falls on the bank. Often a bank will allow a short sale if it results in a smaller financial loss than foreclosing. A short sale is nothing more than negotiating with the lien holders a payoff for less than what they are owed.
Why DO "SHORT Sales" Take So Darn Long?
In a short sell their is no necessary commitment by the bank to sell the house. When a bank agrees to a short sell they are taking a loss that will have to be written off. The bank will carefully way their options, and determine what is a smaller financial loss. They may attempt to convince the seller to refinance. They will require a Broker's Price Opinion(BPO) on the property and may decide foreclosure will present a smaller financial loss. They also require certain qualifications from the seller. As a buyer you may go through all the paperwork to buy a house, and the bank still forecloses. Any short sale Contract includes a contingency where the lien holder must approve the sale.
The bank has a process that each potential short sale must follow. This process can be very tedious and time consuming. As a buyer you can get great deals from buying a short sale, but you must have the time to pursue it. You can also expend a lot of time and energy only to be disappointed in the end. Weigh your decision to pursue this avenue carefully.
Cindy Cranston
Specializing in San Antonio, La Vernia, Floresville and surrounding areas.
RE/MAX Vista - Agent
Email CindyCranston@remax.net Cell 210-373-8634
Website www.GoSeeCindy.com
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