The Short Sale Process For Buyers

Often times people in the market for houses will see a home for sale with an enticingly low price. It seems like such a wonderful deal, so they leap on it for fear it will disappear.

Unfortunately, these buyers don’t know what they are getting into. The process of buying a short sale property is very different from normal property buying.

A short sale means that the property owner’s lender is agreeing to accept a discounted payout to release the seller from an existing mortgage. The sellers have no real reason to bargain hard on price, but you must keep in mind that it is not the owner you must convince, but the lender. Just because the seller accepts your offer doesn’t mean the lender will.

The Short Sale Process For Buyers

If you see an attractive property, even at fire sale prices, take your time and do your research before making an offer to purchase. Your agent will be able to find out who holds the title, how much is owed to the lender, and whether a foreclosure notice has been filed. All this information is important in order to decide how much you should offer. Depending on how encumbered the seller is, the property may only sell for market value.

1. It is important to have an agent experienced in a short sale.  It’s an inconvenience and an annoyance if the listing agent has no experience with short sales, but your agent must have that expertise in order to navigate the brambles of lender bureaucracy and regulations. Short sales are finicky, take a long time, and are prone to falling through with very little reason. You don’t want an inexperienced agent to miss an important detail in an unfamiliar and complex transaction. It makes sense that you would have an experienced short sale agent handle the transaction so as not to waste your time and effort.
2. Once you have made an offer and the seller has accepted it, the offer will be sent to the lender for review. No deal has been struck until the lender has approved it, typically by committee. It may take two months, maybe longer.
3. You will need a pre-approval from your own lender to send with your offer. You should also send a copy of the escrow statement for your earnest money deposit, but don’t be surprised if they ask for more. A short sale is essentially forcing a lender to swallow a loss. That’s bound to make anyone picky.
4. Have your agent to send a list of comparable sales for the area.
5. Organization is key. This is where an experienced agent is invaluable, because a short sale is a lot to organize, and it takes time and discipline to deal with a lending institution.

At Linton Hall, we have a number of agents experienced at the short sale process for buyers. Call today, 703-485-4663, to book a free consultation if you are considering purchasing a short sale.

Short Sale Process For Buyers Free Consultation