SHORT SALES
There are many good people that have experienced financial hardship in these economic times and are wondering what they should do. We all know that there are many REO (Bank Owned) Properties on the market right now, however a large percentage of homes for sale are known as “Short Sales”.
WHAT IS A SHORT SALE?
A “Short Sale” is the term used to describe a sale in Real Estate where a lender, or lenders accept a lower payoff amount than what is owed to them on a property, in order to avoid a costly foreclosure procedure and further loss.
The word "Short" certainly does not refer to the time period in which they take to conclude. Short Sales is a popular way for homeowners to avoid foreclosure and still be able to pay off their loans by settling with their lenders for a reduced amount.
In a "short sale" the seller will not receive any money from the sale of their home. They want to sell but in order to do so they must receive approval from their lender or lenders to take less than what is owed.
In this situation, it is the lender that decides what price the property will sell for…not the homeowner. This can prove quite frustrating; the "short sale" process can take anywhere between 2 to 4 months (on occasion more) and a few may never close.
SHORT SALE vs. FORECLOSURE
A "Foreclosure" is much from a "Short Sale." A Foreclosure property is owned by a Bank or lending institution. It is also referred to as an "REO" or "Bank-owned property" The bank is putting the property up for sale after it has established a price it wants for the property. A sale can be agreed upon quickly.
For the owner that is foreclosed on…they may not be able to buy a home for 5-7 years.
If a Seller decides to go the Short Sale route…they may be able to be in a home-buying position in 2 years.
The best part of a Short Sale is that our services are at no cost to you! ALL traditional sellers closing costs, including the real estate brokerage fees are paid for by your lender!
For more details and to see if a Short Sale is right for you, please contact me. We can discuss some options and then you can decide what is best for you and your family.