With the goal of landing a bargain many buyers in today's market are interested in purchasing short sale properties. But not all buyers are ideal candidates for such transactions. If your home buying criteria includes any of the following you may not be a good candidate:
- You have a lot of contingencies
- You need to sell your current home before purchasing another
- You need to close quickly
- You do not have resources to repair and rehab the property, if needed
If you determine that you are a good candidate for buying a short sale and want to make an offer, here are some guidelines (among others):
- Attach a "Short Sale Addendum" to the contract that stipulates the amount of time you are willing to wait for the lender to review and process the short sale package (but if the timing is too short, the lender may not approve the short sale).
- When it comes to pricing, if the offer is too low, the lender may not approve the sale. Your Realtor should prepare a competitive market analysis (CMA) so you can be realistic with your offer.
- In negotiating a short sale contract, request that the listing agent not submit multiple offers.
- The lender may ask that you contribute to deficiencies due to second lien holders, unpaid home owner association fees, etc. These are negotiable items that can make or break a deal.
- Inspections, financing and other details require the same regimen you would follow in a "normal" transaction. Once the short sale has been approved it is crucial that time lines be established and followed.
With patience, due diligence and the guidance of your Realtor, buying a short sale can save you 10-40% over the price of similar properties in a normal sale.
Learn more about the facts and myths about buying a short sale and how to be a winning buyer in today's market. Click here to download my free handout "Winning with Foreclosures".
Comments (3)Subscribe to CommentsComment