I am continually asked by Buyers about finding short sales and foreclosure properties.  Everyone wants a "deal" today and feels that these properties are the avenue to that end. 

Bank owned foreclosures are HOT and growing hotter by the minute.  Right now foreclosures account for around 20% of the total distressed market and only 7% of the entire active listing inventory.   Foreclosures are REALLY in demand and right now the lenders are calling the shots with multiple offers and NO emotional attachment to their "assets."  Buyers should know that they could easily pay more for a property when dealing with a "bidding war" scenario on foreclosures.  Instead of looking at a foreclosure, I find Buyers often are MUCH happier with finding a property that they REALLY want. In a traditional transaction, they know the history of the property with full Seller disclosures. Often they have MUCH more negotiating room with Sellers who don't sit behind a desk just crunching numbers.

As a buyer, it's also important to beware of the growing number of short sales today.  Even when a buyer and seller agree upon the terms of a contract, escrow is not technically opened until formal lender approval occurs.  The lenders have to determine whether or not they are willing to take less than the full loan amount currently encumbering the property.  And, if there is more than one loan, each and every lender must sign off on the deal in order for an escrow to proceed.  These approvals can take anywhere from weeks to MONTHS.  Also, many of these short sales are priced at levels to attract buyers, discounting well below the true market value.  In this case, the odds of "lender approval" on even a full price offer are slim to none.  As a consumer, it may be best to do your homework and write and offer closer to the market value, ABOVE the asking price, increasing the odds of lender acceptance. 

I'm here to help you with all of your real estate questions, concerns.  You can contact me directly at 800-845-8588, via email at reynolds@socal.rr.com or my website at lindareynolds.com.  

Linda Reynolds