David Bruce

October 1st, 2009

Richmond Area Short Sales

What is a short sale and should I consider buying one?

Short sales occur when someone owes more on their house than the house will currently sell for. The lender will consider it because it saves them the time and effort of a foreclosure. The foreclosure process can take a very long time and be very expensive for the lender.

An example would be a situation where the homeowner owes the mortgage company $250,000 on a house that is now worth only $200,000. The homeowner will be unable to sell their house because they do not have the $50,000 difference to make up to the lender. The lender can choose to accept a short sale on the property or they may choose to foreclose on the property. With so many properties currently in foreclosure the lender will more than likely entertain short sale offers.

What should I look out for when buying?

First you should employ the services of an expeienced REALTOR like Skye Bruce Properties. They can help you evaluate the condition of the property, the existing loans on the property, other properties for sale in the area and the general market conditionof the area.

Making Your Offer to the Lender

When you are making your offer your REALTOR will include what is commonly referred to as a short sale package. This package is something the lender will require in evaluating the offer. Once you submit your offer it will be time to wait for the lender to respond. They generally do not respond very quickly, so you will need to make sure you are patient.  Resist the temptation of having your REALTOR make calls to the bank to follow up as this could make the bank think you are emotionally attached to the property and could hurt you in negotiation.

Negotiating with the Lender

After the lender has reviewed your package they will use this information to help determine whether they will accept a short sale on the property and if so, how much of a discount they are willing to give.

The lender may accept your offer or they may counter with a higher price. If they submit a counter offer, it is up to you to determine if you want to accept their counter or if you want to counter with another offer of your own. Your REALTOR will be your advocate throughout the process.  Make sure you have your own REALTOR acting as a Buyer’s Agent for you and not the listing agent of the Short Sale property to insure your interests are represented in the process.

Success – Your Offer is Accepted!

If you and the lender are able to come to an agreement, then both sides will sign the accepted offer and you have successfully purchased a short sale property.

Buying short sale properties can be a very time-consuming and frustrating experience. But it also can provide the opportunity to purchase a property below current market values in a nice Richmond neighborhood.

For more information on buying a Richmond area short sale property contact Skye Bruce Properties today!

This entry was posted on Thursday, October 1st, 2009 at 10:41 am and is filed under Real Estate News and Statistics. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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