Short sale listings in Las Vegas, NV are attractive to buyers because of price. Almost 1 in 6 listings in the valley (4186/24005) are short sales. Only 1 in 13 are in contract (324/4186). Only 1 in 6 close (56/324). Those numbers are dismal for the short sale seller or buyer. Listing and pending numbers are for 1/7/2008 and closed stats are from December 2007.
What is a short sale?
A short sale is when the seller is selling for less than what they owe to the bank. Instead of coming up with funds at the closing table they are requesting that the bank forgives the part of the debt between the sales price, concessions, commission and other costs of selling a home to what the owe.
What is the process?
When a seller lists their home for sale, they usually have to wait for a buyer to submit an offer to get the process rolling. They must submit a "short sale package" to the bank. If there is more than one lender, the short sale package must be submitted and negotiated with all banks. The offer is not completely accepted until the bank accepts it!
Once the bank has considered the offer, a BPO will be ordered. A BPO is a broker price opinion, which is similar to an appraisal but done by Realtors (R).
Finally, the bank may or may not approve the short sale. Currently it seems short sales are approved only if the bank is losing no more than 20%. Banks are also scrutinizing the packages and the sellers/buyers to make sure loan fraud is not occuring.
If I am a buyer is a short sale a good purchase for me?
It depends.
Is time of the essence? If it is, then probably not. It isn't unheard of to wait 60-90 days for an approval from the bank and then sometimes the house can get foreclosed on while waiting.
Can you fall in love with more than one house? Some people can't. With the "numbers game" that you have to play with the short sale, you will statistically have to write 6-10 contracts prior to getting one approved.
Do you have extra cash laying around? Hopefully you do. Many banks or short sale sellers will not correct defects from deferred maintenance or title liens. It isn't uncommon to have both problems. Make sure a preliminary title report is done on this property prior to bank acceptance so you can live with the liens. The most common liens here and now in Las Vegas are HOA dues, sewer and garbage.
If you are buying or selling a short sale property in Las Vegas, NV, make sure you are prepared for each surprise you may encounter along the way. ALWAYS interview your agent to make sure they are knowledgable about the short sale process and are diligent. An agent can make or break the deal! Make sure you are diligent in getting your paperwork in as requested and good luck!
Some Excellent Short Sale Writers:
Ken Cook
Bryant Tutas
Bill Roberts
Dan Forbes
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Excellent, excellent Renee.
The new buzz word for real estate today is "short sale". It behooves agents and brokers to know what it means to buyers and sellers.