Purchasing a short sale listing gives buyers a unique opportunity to acquire an attractive home at a discounted rate. Unlike a foreclosure, most short sales have been occupied either right up to the sale or have only been unoccupied for a very short period of time. This reduces the chances of a buyer having to spend a great deal of money rehabbing a property and cutting into their potential profits. If you and your real estate clients are looking at short sale properties, here are a few tips that you should keep in mind.
Check Market Value
Typically, when a lender agrees to allow a short sale, they know they are going to be losing money, but they work hard to minimize their losses. Even though they will accept less than what the seller owes, they are not going to consider loans that are significantly below the area’s fair market value. Make sure you are aware of the market value of the home prior to making an offer that is unreasonable for the area. Attempting to severely undercut the listed the price may result in you losing the house entirely.
Have Financing in Order
Make sure you have you or your real estate client has their financing in order. A short sale moves significantly more quickly than a traditional sale. It is possible to receive approval in three weeks, so make sure you have financing in place or money in the bank. The last thing anyone wants is to have the sale approved and a buyer who does not have the funds needed to complete the transaction in a timely manner. Remember, even if the seller is willing to wait sometimes, their lender might oppose the delay, especially if they believe another buyer is able to pay more for the same property.
Do Not Ask for Extras
In a traditional home sale, it is normal for a buyer to ask the seller to make repairs, have certain inspections done, and complete other tasks designed to make the buyer happy. When you are buying a short sale, do not expect the seller or the bank to do anything more than the bare minimum.A person who is already selling a home for less than it is worth is most likely not going to want to waste time negotiating on repairs; they and their lender want the home sold as is with no additional investments on their part.
Never do it Alone
During a short sale, the seller is usually focused on selling the property as quickly as possible to avoid a foreclosure, and the bank wants to recoup as much of their losses as possible. Neither party is going to be interested in protecting the buyer’s best interest or helping them navigate a difficult process. Having a skilled real estate attorney on your side ensures that you have the legal advice you need to ensure that you are getting a fair deal. The legal team at Adam Law Group is here to provide you with the help you need, so contact us today to schedule a consultation at our conveniently located Jacksonville, Florida office.