Its come to my attention that there are alot of terms being thrown around in Real Estate today that nobody heard of 4 years ago. Although these things existed at that time they were not as prevalent as they are today and due to this mainstream America was not familiar with these terms. Today it can be very confusing to be a buyer as these terms are being thrown around all the time, and many times being used incorrectly. Let me start by saying that most of these types of sales are not for the weak of heart and for many traditional buyers you are better off at looking at traditional sources of sales, estates, divorces, retiring etc. These sales will usually go through with very few bumps.
The discount sales. This brings me to my purpose of writing this. We now have a category of sales that are discounted because there is distress and the possibility to get a "good" deal as a buyer. These sales are making up approx 30% of the us real estate market. This is not the case in Massapequa as we have still not seen the decimation that many other communities have. One type of sale in this category is short sales. A short sale is a sale in which the seller owes more on the house than the house is worth, this sale is tricky as it involves the bank agreeing to accept less than they are owed and 90% of the time releasing the seller from making up the difference (see my blog post from last week). The benefit to the seller is that there are no fees paid by them and in most cases they are able to get out from under a bad situation with dignity intact and not too much damage to their credit. To the buyer the benefit is buying a house for slightly less than market value, that has not been destroyed bc someone is still living in it unlike a bank foreclosure.
The next category is REO which stands for real estate owned, this is the category which everybody is now grouping foreclosures and bank owned into. The major difference between these types of sales and short sales is that the bank has already foreclosed and took ownership of the property. In many cases these properties have had severe damage inflicted on them by the homeowner who was forced to leave the home and in a bitter fit of rage decided to destroy it. Many times even if the homeowner has not destroyed the house it has sat abandoned which brings its own issues. These homes are sold at considerable discount, but in many cases these houses have been so damaged that a traditional mortgage will not work and many times the discount that was achieved for the traditional buyer is \not worth it because of the cost associated to rehab. These homes tend to go to investors who have cash to buy, and the resources to complete the renovation on their own.
If you would like more information please contact me at 516-655-3860 or email me at sdonnellanre@gmail.com
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