Monday, October 8, 2012
The pros and cons of purchasing a short sale property
Some buyers find themselves contemplating the purchase of a short sale, a property that sells for less than the balance its owner owes on the mortgage, despite the possible added complexities. If this is something that you are considering, please take note:
Pro: A major advantage to purchasing a short sale property is the price. Banks do not want a property to go into foreclosure, which is usually the next step if a short sale property fails to sell. Often buyers can purchase a property for under the market value.
Con: The disadvantage of buying a short sale is that it can be a very lengthy process. Short sales often take significantly longer than normal closings due to the amount of people involved in the transaction. The bank employs negotiators to get the maximum amount for a property and once the negotiator approves, a supervisor must review the package. You may wait for months while your offer is evaluated and the lender may reject your offer, even after having had the paperwork for a long period of time. If you do not have a flexible time frame, a short sale probably isn’t for you.
Recommendation: When shopping short sales, remember to work with a qualified real estate agent who has experience with short sales. Short sales can be complex, so it helps to ask about experience and success with short sales and familiarity with the process and lenders.
Contact me for more: Mark Schreier Century 21 Prevete Real Estate. 516 263-9094