When looking into buying a home, a great way to get a nice home for a decent price is buying short sales. Short sales are homes that are being sold for less than what is owed on them.
When a home owner defaults on their loan due to financial hardships, they may request a short sale from the lien holder (usually a bank).
This can be great for buyers looking for a deal. There are certain things you should look into with short sales however, and here are some tips that will help you along the way.
If you're contemplating buying a short sale home, you better be prepared to test your patience. A common misconception is that short sales are quick because banks want to get rid of a house.
However, short sales can sometimes take up to a year to complete due the process banks go through to finalize everything. Also, make sure your real estate agent has dealt with short sales before.
Short sales are not like a regular sale, so you'll want an experienced agent on your side to help guide you. It also doesn't hurt to do a little research to know what you're getting into with a short sale.
Remember that short sales are the result of the home owner not being able to pay their mortgage. If they were struggling to pay their mortgage they most likely couldn't afford to keep up with the maintenance and repairs that go along with home ownership.
So don't go in expecting to find a home in perfect condition. Expect to spend some money to get the property up to par. Remember, in a short sale, you're buying property as-is. Because of this, you should inspect before you buy.
Checking public records to find out info on the owner is also a great idea. You may be able to find out how much is owed on the property, which will help you determine a good offer price.
Short sales require a lot of paperwork and documentation. Some of the documents to have ready for the bank are your pre-approval letter, offer letter, and a copy of your earnest money deposit.
If the bank asks you for any documentation make sure you get it to the as quick as possible to help speed up the process. Mistakes in paperwork can slow the short sale process up considerably. And the last thing you want to do is delay the process more than necessary.
Again, patience is the key. After you've submitted your offer and all the necessary paperwork, give the bank some time to respond.
Make sure you have the appropriate contact information for whoever is helping to conduct the short sale on the banks end in case you have any questions. Have your agent check back with the bank from time to time as well just to stay up to date on what's going on.
Short sales can be a great way to get a deal for a home buyer, but some people often give up due to the long process. If you stay patient and well informed, you may snag your dream home for an awesome price!