We get lots of questions about short sales. What is a short sale? How do you buy a short sale? How long does it take?
These are some of the questions we get. In the next few sections, we hope to catch you up to speed on Short Sales!
Short Sales Explained.
Short sales happen because the loan on the property is larger than the sale price minus all the sale expenses. With a short sale, the seller is asking the bank to take less than the amount owed. Banks will allow short sales so they can recoup some of their costs. They know the home owner is underwater and probably well behind on their payments. Instead of “owning” the house through foreclosure, they will work with the home owners to negotiate a lower than loan sale price. Short sales will hurt the credit score of someone selling a house short, but not nearly as badly as a foreclosure. Its not really a win-win, but its definitely not a lose-lose – maybe somewhere in between.
Short sales take a MUCH longer time to close than a conventional home buying process
This is sort of easy to explain. A short sale includes a buyer + a seller + a bank = three’s a crowd!
“Short sales aren’t taking as long as they did a year ago, but the average time it takes to close on a short sale is currently 90 to 120 days.” FoxBusiness.com
The only way to close in 90-120 days is if you are working with an experienced short sale selling agent. They must know the process and the legal end of a short sale.
It’s important to know that a buyer and their agent have no control over the process. The success of a short sale — and how long a short sale takes — relies heavily on a listing agent (you need someone experienced with short sales – see TRI County Real Estate!). If the listing agent isn’t experienced with short sales, you’re likely wasting your time. A good short sale listing agent will properly advise the seller and have a thorough knowledge of the bank and its process before your offer is accepted.
We could talk all day about how to speed up the process, but Forbes.com has a great article on how to speed up short sales. Forbes article on Speeding up short sales
Looking for a NC short sales agent? Look no further than TRI County Real Estate! Contact us for help selling your home as a short sale.
Are you a candidate for buying a short sale home?
Are you looking for a bargain? Then maybe you are a candidate for buying a short sale property…maybe. Here’s a list of things you’ll need:
- All your financing in order – 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.
- No contingencies – Lenders like no-contingency offers and flexible closing terms.
- More Patience
- Real estate attorney experienced with short sales – lots of legalese to work through
- Qualified real estate professional experienced with short sales – Not a friend or family member, you need an agent experienced with short sales
- Title officer – they can help establish all the liens on the property and help your agent determine the likelyhood of getting a deal done