Short Sales: What Do You Need to Know?

It has only been the last few years that we have had the term (status) contingent short sale as a description of the status of a property. What this means is the Owner (Seller) is trying to sell the home เช่าคอนโด ห้วยขวาง for less the they owe. The buyers has submitted an offer to purchase the home and the Seller has agreed to the terms. Now it all has to be submitted and approved by the mortgage lender of the Seller. The sellers lender is the one who is going to be short meaning they are going to accept less money to clear the title then what is owed to them. So that is where the term contingent short sale comes from, it is contingent upon the mortgage holders approval of the payment short of what they are owed.

So many people think that short sale means quick but actually I have seen them take up to 6 months, and I am sure some take even longer. My experience has been that usually the 1st buyers get tired of waiting and move on to other opportunities. It is usually the 2nd buyer who does not have to wait as long because much of the negotiations are completed. If you are in a hurry or on a time limit of when you need to move in to your new home a short sale may not be the right option for you.

Short sales can be great financial investment opportunity, but you definitely have to have a lot of patience. I have been selling homes in Jefferson County Mo since 1993 and it is only been the past few years that we have had to really deal with the short sales. I have seen them get approved and close as quick as 30 days but I have also experienced 6+months of waiting for the banks to approve these sales.

In some situations the banks will refuse the offer and counter back with an amount they are willing to work with. So you cannot always be guaranteed that if you offer the full asking price that the bank will accept it. After the offer has been submitted and the Sellers have turned in all their supporting financial documentation and hardship letters the bank will usually order a BPO (broker price opinion) or an appraisal depending on the bank policy.

Depending on the length of time the home has been on the market the listing agents will advise the sellers to keep dropping the price every few weeks until they get a written offer from a qualified buyer. The reason for this is the short sale approval process usually will not even start until there is an offer on the table. The bank will rely on the BPO or appraisal to determine the sales price and loss they are willing to accept.

Short sales are a great opportunity but you cannot be in a hurry and you have to be prepared that the bank will want more than you and the sellers have agreed too.