Thinking of Making an Offer on a Short Sale? What You Need to Know

By
Real Estate Agent with Berkshire Hathaway HomeServices - C. Dan Joyner 21498
 
 
 
Are you looking to buy a new home? Are you thinking that now's a great time to find bargains? That's true, but it pays to know a little about the seller's situation before you make an offer.
 
If a home is being sold for below what the current seller owes on the property it is considered a short sale. Many more home owners are finding themselves in this situation due to a number of factors, including job losses, aggressive borrowing against their home in the days of easy credit, and declining home values in a slower real estate market.
 
A short sale is different from a foreclosure, which is when the seller's lender has taken title of the home and is selling it directly. Homeowners often try to accomplish a short sale in order to avoid foreclosure. But a short sale holds many potential pitfalls for buyers. Know the risks before you pursue a short-sale purchase.
 
You're a good candidate for a short-sale purchase if:
 
· You're very patient. Even after you come to agreement with the seller to buy a short-sale property, the seller’s lender (or lenders, if there is more than one mortgage) has to approve the sale before you can close.
 
· Your financing is in order. Lenders like cash offers. But even if you can’t pay all cash for a short-sale property, it’s important to show you are well qualified and your financing is set. If you're preapproved, have a large down payment, and can close at any time, your offer will be viewed more favorably than that of a buyer whose financing is less secure.
 
· You don’t have any contingencies. If you have a home to sell before you can close on the purchase of the short-sale property—or you need to be in your new home by a certain time—a short sale may not be for you. Lenders like no-contingency offers and flexible closing terms.
 
If you're serious about purchasing a short-sale property, it's important for you to have expert assistance.  You may have a close friend or relative in real estate, but if that person doesn’t know anything about short sales, working with him or her may hurt your chances of a successful closing. A qualified real estate professional will be able to show you short-sale homes, help negotiate the purchase when you find the property you want to buy, and smooth communications with the lender. (All MLSs permit, and some now require, special notations to indicate that a listing is a short sale. There also are certain phrases you can watch for, such as “lender approval required.”)
 
If you would like assistance with a short sale, give us a call or email us today. I hold a CDPE (Certified Distressed Property Expert) designation and have helped many other buyers navigate there way to buying a short sale.
 
The risks of a short sale are considerable. But if you have the time, patience, and iron will to see it through, a short sale can be a win-win for you and the sellers.
 
*Note: This article provides general information only. Information is not provided as advice for a specific matter. Laws vary from state to state. For advice on a specific matter, consult your attorney or CPA. 
Posted by

If you are looking to buy or sell a home in the  Anderson or Greenville SC real estate areas, visit our website at www.SheilaNewtonTeam.com for tons of great information.

 

   
Sheila Newton   
Sheila Newton Team 
Berkshire Hathaway HomeServices -
C. Dan Joyner, Realtors
864-225-1205 (direct)
864-940-6377 (mobile)

www.SheilaNewtonTeam.com    


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Larry Story
Total Care Realty - Greensboro, NC
Total Care Realty, LLC, Greensboro, NC Real Estate

Shelia,

As you know most of the work in a short sale is on the listing agent.  While I will go after whatever home my clients want I will warn them if the listing agent is not experienced in short sales.  I just had one go sideways on us last month.  We ended up after waiting for two months with a contract pulling out because of the way it was being handled.  We of course are now under contract on a nicer home that is not a short sale but still a great deal.  I list and sell a good deal of short sale homes.   My average is between 30 to 45 days for approval.  

Jun 16, 2011 02:42 PM #1
Rainmaker
643,079
Marchel Peterson
Results Realty - Spring, TX
Spring TX Real Estate E-Pro

Sheila, I always tell my buyers another name for short sale should be LONG SALE as it takes a very long time.  I've been on the listing agent side several times (before they were popular) but have not been on the selling agent side.

Jun 16, 2011 03:55 PM #2
Rainmaker
818,843
Sheila Newton Team Anderson & Greenville SC
Berkshire Hathaway HomeServices - C. Dan Joyner - Anderson, SC
Selling the Upstate since 1989

Larry - sounds like a great average... and congrats on the buyer uc .. Hope it closes fast!

Marchel - It is true that it is a LONG sale... lol... but for those that work out, it is a great thing to go to those closings...

Jun 16, 2011 04:07 PM #3
Ambassador
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Mona Gersky
MoonDancer Realty, Dillsboro,NC - Sylva, NC
GRI,IMSD-Taking the mystery out of real estate.

Sheila, don't you ever rest? This is another great post on a subject we can all use more info on. Thanks.

Jun 16, 2011 05:13 PM #4
Rainmaker
743,138
Dan Edward Phillips
Dan Edward Phillips - Eureka, CA
Realtor and Broker/Owner

Good Morning Shelia, excellent information to provide clients who are considering a 'short sale'.  They need to know the issues before making an offer.

Jun 17, 2011 02:36 AM #5
Rainmaker
818,843
Sheila Newton Team Anderson & Greenville SC
Berkshire Hathaway HomeServices - C. Dan Joyner - Anderson, SC
Selling the Upstate since 1989

Mona - the one habit I can't seem to break is the one blog a day... :).... LOL

Dan - Thanks.... hope you can use it.. :)

Jun 17, 2011 01:04 PM #6
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