Purchasing Short Sale Properties
A lot of people want to have good bargains when it comes to buying properties. The opportunity of getting one has been made possible by the auctioning of the foreclosure properties in the market.
Unfortunately, the chances of getting them are slim because people who have more money usually get their first dibs on them. Real estate investors are very good in finding them that as this is how they make a living. They get first hand information from contacts and upon hearing the news, they already have an action plan to get the property. They can even bid the maximum and still get the best price for the property.
If you were an ordinary person wanting to buy a house for personal use, you can get deprived of this opportunity. Some wouldn’t go all the way to top an investor’s bid just to own a bargained property. If this happens, you may get caught up with the bidding war. You can win the bid but then you may have paid already too much for the property.
So a better option in getting bargained properties will be short sale. This kind of option does not involve bidding. The properties for sale are those that are being foreclosed. It’s just that the seller is trying to avoid the foreclosure process that is why they are selling the property for less than the amount owed from their lenders.
However, buying a short sale property isn’t a walk in the park. To be able to get the property, you have to do several things. One is to make an offer that the lender wouldn’t hesitate to accept. The seller would then go to the bank and submit the request for short sale, together with your offer and their letter of hardship. Then it would take time before the bank would approve the sale because they have to analyze their losses.
The good thing about short sale is that you get to transact with the seller personally.
Tips in Buying Short Sale
First of all you have to find a property for short sale. Finding them is not a piece of cake but they are everywhere. It is just a matter of identifying them. The best way is to ask a real estate agent. But you can go ahead and visit local courts to see which properties are foreclosed. And you can check if you can talk the owner into selling through short sale
It is also best that you investigate about the seller. Ask them the reason why they had problems for mortgage. Ascertaining the kind of hardship they are going through will give you an idea on the likelihood of getting the short sale approved. Get pre-qualified for financing. If you are serious on buying the property, you must have the necessary funds to buy it. If you have to get mortgage for it, then start working your application ahead of time.
Determine the legal implications of buying the property. You do not want to have problems with the seller’s encumbrances that will be passed on to you once you own the property. Before deciding to go through with the purchase, consult a real estate lawyer to determine how the encumbrances could affect you in the future.