Five years ago buying a short sale was practically unheard of, but in today’s housing market they can be a hot deal. While most sellers and buyers are aware that short sales can be difficult, most people have no idea how to prepare for the process.
Expecting The Unexpected
There is no doubt that the seller has the toughest job in the short sale process. As an alternative to foreclosure, they are selling only to avoid going under financially and suffer credit damage. As the main mediator between a potential buyer and the bank, the seller has no power and all the responsibility. Sellers should be aware that they can only accept an offer to present to the bank and cannot officially declare the home as sold. Further, sellers should expect that the bank will reject offers and the process could be prolonged, costing them continued payments on the mortgage until the house is sold.
Buyers are in a unique position to gain a home, often for less than valued. However, buying a short sale takes patience. Buyers must present the best offer possible to eliminate a drawn out negotiation process. Banks are often unwilling to accept offers full of conditions or that lack an adequate price. Buyers should be aware that their top dollar for purchase is generally the best offer to make right out of the gate. Further, it should be expected that it can take anywhere between one to six months before hearing about the status of their offer. Therefore, buyers should not consider a short sale if time is of the essence.