Thursday, July 21, 2011

Thinking of buying a short sale property? 

 

If so, there are some things you need to know:

A short sale means the seller’s lender is willing to accept a discounted payoff to release an existing mortgage.  However, just because a property is listed with short sale terms, that does not mean the lender will accept a buyer’s offer, even if the seller accepts it.  Buyers pursue short sales to get a good deal, but lenders are reluctant to accept offers that are below the current fair market value of the property.

Short Sale properties tend to present a variety of risks for a home buyer.  Homes are frequently sold “as is”, which means that no repairs will be made by the seller or lender.   Therefore, most agents recommend a home inspection to determine the true condition of the home and to get an estimate of repair costs.

Overall, the short sale process tends to be lengthy, and in some real estate markets, fewer than one in 10 short sales close for a variety of reasons.   The entire short sale process can be very challenging; however, working with a real estate professional who is experienced in short sales can increase the odds of a successful close.

A buyer considering a short sale should consult with an attorney and/or a licensed tax professional to understand all obligations relating to a short sale.

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