Should You Consider A Short Sale Property?

By
Mortgage and Lending with CMG Financial NMLS# 312738

Things to Consider When Buying a Short Sale

  • February 18, 2016

For many, short sale properties are a draw for potential buyer because of the lower price they are listed at. But before you choose to make an offer and invest in a short sale property, here are some things to watch out for. 

First off, “a short sale occurs when a property is sold at a price lower than the amount the homeowner owes on mortgage, and the homeowner’s mortgage lender(s) agrees to the “short” payoff. A lender might accept a short sale with the property worth less than the balance of the mortgage, if the borrower cannot continue to make the monthly loan payment, does not have enough money to pay back the full balance of loan and needs to move out of the property.” Freddie Mac 

 Inspection Issues – don’t ignore inspection issues, or skip the inspection all together! Often times, the property has been neglected to some extent due to the fact that the previous owner(s) were unable to keep up with the costs of paying for the property. Being meticulous with inspections and researching potential property issues will help set you up for success rather than becoming overwhelmed with issues after you have completed the purchase. 

Potentially Longer Closing Times – Short sales are much different than a regular purchase. There are a lot of rules, paperwork, and time involved so if you are in a rush to buy a home, a short sale is most likely not the way to go. Often times, the process and closing of a loan on a short sale home will take significantly longer than a more common transaction. 

Prepare for Needed Improvements – In line with being mindful of inspections, be prepared to invest in and spend the time making necessary improvements to the property before moving in. Not all properties will be move-in ready due to the circumstances and will need some work. 

Talk to your mortgage professional today for more information on purchasing a short sale and making this investment if it is right for your specific financial situation

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Rainmaker
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William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

I want to know that there is a professional negotiator doing the short sale before I will get involved and then my clients need a lot of Patience

Feb 18, 2016 09:05 AM #1
Rainmaker
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Pat Champion
Coldwell Banker Camelot Realty - Mount Dora, FL
Call the "CHAMPION" for all your real estate needs

I agree with the previous comment I always want to make sure the negotiator is experienced; especially, since there are so many uncertainties with a short sale. Thanks for sharing I hope you have a great weekend.

Feb 19, 2016 11:58 PM #2
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Rainmaker
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Tim Carroll

Area Manager at CMG Financial
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