Buying a home in short sale can financially be a great move on your part. However, the short sale process is a little more strenuous than you may think, and without the right guidance, it could be more stress than it’s worth. Today, join us as we navigate through a short guide to the short sale.
For those readers out there who do not know, a short sale is when a property is sold for less than what is currently owed on the mortgage. While the seller may be anxious to get the property off their hands, there are some things that you seriously need to consider, or else you might be paying for more than house worth.
Out of all the things that you cannot afford when looking at a short sale, property problems are number one. In houses that have been left vacant for some times, structural problems may arise, or there may be a termite infestation lurking around. On the other hand, sellers in an occupied home could not be disclosing all the issues the house has, in an attempt to have it sold as quickly as possible. No matter the case, we highly discourage you from skipping the home inspection—it just may be the thing to secure you a better deal on the property, or to avoid a poor investment altogether.
Another big piece of advice with short sales is time management—be prepared to wait, and after approval, be prepared to scramble. Once an offer is made, the bank will have to approve it, which may take several days or weeks, depending on the speed of the bank. Some offers may sit on a manager’s desk for a solid week before it is even looked at. However, once approval is given at that price, banks give a very short turnaround time that must be adhered to.
Unlike a traditional sale, there is little to no leniency when it comes to a closing date—if you cannot make it happen, the bank will move on. Take this into consideration, and make sure that you have enough funds to cover the incidentals of a home purchase in such a short time period.
In addition, when looking to buy a short sale, it may be worthwhile to consider it as a n investment property. By doing a little TLC with it, you can turn the property that you bought at an outrageously depressed price into something formidable to put back onto the market, or to even keep it as a rental property. Becoming too attached to a short sale can lead to bad financial decisions, so do yourself a favor and approach it as just another investment, and not a family home.
Finally, the process of a short sale can be much easier when you have a team of experienced realtors behind your back. At American Dream Realty of South Jersey, you can be assured that the best agents in the region will be behind you, every step of the way, from the offer, to negotiation, to closing, and beyond.
Come on in and see what we can do for you.