What are the risks?
With a short sale, an additional risk is that the bank won't approve the offer you've made to the seller. Short sales also can take a long, long time. Some have taken 12-14 months. Four to six months isn't at all unusual. And because the seller is in financial distress, there's a risk that the bank will foreclose on the property even while you and the seller are pursuing a short sale.
With a foreclosure, the main risk is that the bank will just take a long time in considering your offer. Another risk: Lots of times, people who've been foreclosed upon leave the house angry . . . and deliberately damage it. So often the property isn't in the best condition. Even if the owner didn't deliberately damage it, sometimes it gets vandalized. Or it isn't winterized properly and you have damage like burst pipes.
The process to buy is to make an offer through your Realtor. With a short sale, it's a 3-way transaction. You make an offer to the seller. The seller accepts. Then the offer goes to the bank for its approval (which is no sure thing).
With a foreclosure, you make an offer directly to the bank (using your own Realtor).
Hope that helps.
A short sale is when the seller still owns his/her property but the sale of the property will result in inadequate funds to pay off what the seller ows the bank. As such, the bank must approve the offer and agree to take less than what is owed them.
A foreclosure is the same as bank owned. The bank has foreclosed and now owns the property. This is referred to bank bank owned and also REO (real estate owned).
Thanks and hope you enjoyed your holidays!
Rich Bennett, Realtor
Zephyr Real Estate