When thinking about the short sale process most people tend to focus on how it affects the seller. After all, they are the ones who are in mortgage debt looking for a way out. Not many people stop to consider how the short sale process affects the buyer. For many buyers, the process can be scary and even downright intimidating. However, there are great deals to be gained in a short sale, as long as the buyer is prepared to navigate the process.
A Buyer’s Market
The biggest problem buyers face with a short sale is time. The process can take much longer than in a traditional sale because the bank has the final approval over the offer on the house. If the bank feels they could get more money, they will hold out for more buyer offers. The best strategy for a buyer of a short sale is to have their mortgage lending pre-approval prior to placing an offer and to go in with their best offer the first time. Banks rarely negotiate and are more willing to consider an offer from a buyer who is already pre-approved and goes in with their strongest offer right away.
Buyers may also face issues with the home inspection or condition of the home. Similar to a foreclosure, the lender is usually not willing to negotiate repairs and buyers face securing the home in an “as is” condition. However, most short sales are in good condition and people rarely trash them, as is the case with many foreclosures. Since the seller stands to benefit from the sale of the home, buyers do not typically encounter many out of the ordinary problems with the home. Buyers that are considering a short sale should ensure they have a home inspection, as well as an appraisal to be sure they are getting a good deal on the home.