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Purchasing a Short Sale or Foreclosure Property
So you are wondering what is the difference between purchasing a foreclosure, short sale, or bank owned property is in the DC Metro area? These days the terms seem interchangable so in part one of this series I will define the actual terms. So here’s a brief breakdown that should simplify some of the language.
Short Sale – In this case, the homeowner has usually stopped paying the mortgage. In addition, the home is worth less than what they owe the lender. If they’re able to (1) find a buyer and (2) get the lender’s blessing on the deal, the lender will accept a portion of the total loan payoff amount. The lender is left short, hence the name. Short Sales are sometimes great bargains for buyers, but know that buying a short sale can sometimes takes months. The home comes without any disclosures about condition, and typically is sold As Is. Buyers can inspect the house but Sellers/Lenders won’t do any repairs.
Finally, you have to play a waiting game. Lenders are overwhelmed, they were never set up to operate as a real estate brokerage in the first place, and will probably take a month or more to even ... more
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