Purchase- Short Sale

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Purchase- Short Sale
Purchase A Short Sale, Know The Facts

Tips for Purchasing a Short Sale Home

 

Short sales are a fact of life in Ellis County as they are in the DFW area.  A short sale is when the owners equity is not sufficient to sell the home and payoff the mortgage and pay the owners closing costs.  The owner must have a “special situation” but the rules on the special situation have been relaxed.

Are you interested in buying a short sale? Depending on the timing, you might find a lot on the market. Astute buyers often seek out these listings in the hope of getting a great deal on a home.  We have the ability to set up searches that will notify you immediately when a short sale matching your needs comes on the market.  You need to be the first to see and make the offer on a short sale.

However, short sales can be challenging. They often draw multiple buyers, who compete for the winning bid. And it can take a while for all the paperwork to wind its way through the approval process.  It is not uncommon for short sales to take 8 to 16 weeks to close compared to 4 or 5 weeks for a normal sale.

Again a short sale occurs when a house is sold by someone whose outstanding mortgage balance is more than the house is worth. The owner works with his bank, which must agree to accept less than it is owed on the house. As a result, short sales often take longer than a traditional sale.

Here are some tips to successfully purchase a short sale:

  • Work with a knowledgeable real estate agent who has experience with short sales. Your agent will be able to keep you up to date on new listings as well as help walk you through a process that can be lengthy and frustrating at time.
  • Stay up on the market so you know when new short sales become available.
  • Act quickly! When you spot a house you like, try to be the first to submit an offer.
  • Be patient. These transactions often take 30 to 60 additional days—or more—due to all the documentary requirements.
  • Submit a reasonable offer. Remember that the lender is looking to reduce its losses as much as possible and with competitive bidding likely for the house, your offers need to be in the ballpark. Have your agent do a Market Analysis on the property.  You should be able to buy a short sale on the low end of the range.  Call me if you need a Market Analysis, I do them for free.
  • Try to include as few contingencies in your offer as possible. You won’t want to waive your right to inspect the property, but if you are pre-approved for a mortgage, then the lender may consider your offer to be more solid than other buyers’.