If you asked the average homeowner five years ago what a short sale was very few, if any, could answer correctly. Since 2008 short sales have become a dominant force in the real estate market and the main source of real estate transactions. It was only a few years ago that a majority of sales were completed from either short sale or foreclosure. This number has been greatly reduced in recent years but there are still many good short sale deals available. These deals are not perfect and may not even be for every buyer but they are still available if you know where to look.
What Is A Short Sale?
A short sale is simply a real estate transaction where the homeowner owes more than the property is worth. To close the lender needs to agree to the sale and accept the purchase price. When the market was plunging lenders would often accept 60-70 cents on the dollar just to get the liability off their books. Since the market has rebounded there is much less demand to sell but there are still homeowners in default every day.
Where’s The Short Sale Deal?
The keys to finding a successful short sale deal is to be willing to wait the bank out and finding properties that you can create value in. In spite of the vast amount of transactions over the past five years the short sale process still remains a lengthy one. It is not uncommon for them to last anywhere from six months to a year. If you are looking to move in over the next 30 days a short sale is not for you. However if you are not in any rush and are willing to wait on the lenders decision a short sale can provide a real discount. Most of these properties will require some work or have been on the market for a substantial amount of time but that doesn’t mean they should be ignored. One man’s trash is another man’s treasure.
Finding a good short sale property and getting an offer accepted are two different things. To increase your chances of getting it accepted you need to have all of your paperwork and finances in line when you submit your offer. If there are documents or signatures missing the lender may not even look at your offer or it will be put on the bottom of the pile. Even though the days of massive discounts on short sales are gone you can still make an offer that works for you. If you provide everything the lender is looking for, especially a clean contract, you will greatly increase your chances of getting your offer accepted.
Short sales can be very time consuming and take a while to close but for the right buyer they can still provide a great deal. If you target the right property in the right area and are willing to wait on an answer there is no reason you should ignore these listings.