The Short Sale Craze — What is a short sale?

By
Real Estate Agent with Keller Williams Advantage II Realty

In order to understand the Orlando Real Estate Market, you need to know what a short sale is and how it can be a great opportunity for you. 

                                               

Definition of short sale:   A sale of a house in which the proceeds fall short of what the owner still owes on the mortgage.  

Due to the inflated housing market of 2004 - 2006, buyers who purchased in that time frame may now owe more than their home is currently worth.    Someone looking to sell after only owning their home for a few years may not be able to sell for a high enough price to pay off their current mortgage.  This is leading to many short sales in the Orlando real estate market, and plenty more foreclosures

A few ideas to think about when it comes to buying an Orlando short sale:

  • In order to purchase a home that is in a short sale situation, you will need to understand the process of working with both the seller and lender/bank. 
  • Negotiations will primarily be with the bank, but the seller still has to agree on the final sale price. 
  • There are more steps to closing a short sale deal than your normal buyer/seller real estate transaction. 
  • It can take up to 180 days to close on a short sale, and sometimes longer.
  • Short sales are a tax liability to many sellers, depending on if it is the original loan or an investment property.

A few ideas to think about when it comes to selling your home as a short sale:

  • You must list your home with a Realtor in order to be considered for a short sale
  • You must be able to show the bank your financially unable to pay for the home
  • You must be able to show the bank that your home is worth less than what is owed, with closing costs included
  • The process will take much longer than a normal sale
  • There are tax consequences to most types of short sales

To find out more about short sales and how you can benefit, visit www.OrlandoAreaDreamHomes.com, call Erik Hansen: Cell (321) 662-1025 or send an email to ErikH@kw.com.  

Comments (1)

Richard Ives
Chicago, IL

Great post Erik!  Have a great week!

Sep 24, 2008 06:59 AM