Melissa,

My name is Robin Speronis and I am the Owner/Broker of Zen Real Estate of Southwest Florida, http://www.AskZenRealEstate.com and you need to do much more homework on the sellers, the listing agent, the lender(s) and the status of the short sale and the foreclosure action in addiition to the status of the market today and the what could possibly be the status of the market 3 months to a year from now - which way is everything trending? And this should have been done by you and your agent (I hope you have your own agent!) before even making an offer on the short sale.

I have a buyer who put an offer on a short sale on a condo in June. His daugher was starting college in Florida in September and he thought it would be wise to buy a condo instead of renting an apartment for her. The problem was that the condo market was not near bottom in June - still trending down big time. So we found a condo in a development that was having it's problems, but had a strong association and we could tell after doing our homework that the condo association is going to make it. The unit is prefect for an 18 year old going to college and being away from home for the first time. We did a Chinese dryway inspection (condo built in 2006) first thing - $250. We did a short sale and my buyer has been renting the condo for his daughter since August and paying for rent just the condo fee every month - that's fair since the seller has not been paying the mortgage and my buyer's daughter is using the pool, club house, etc.

The listing agent on this unit has closed many short sales, the lender is Bank of America. who takes a long time to close short sales, but closes them because they are high profile and have taken so much money from the government that there is a lot of pressure on them to close good short sales. The seller is represented by a lawyer in the foreclosure action and the seller has answered the lis pendens summons, so that gives the seller much leverage in the short sale negotiations also.

Condos in this association have loss about 30% in value since we put the offer in in June. I expect that we will close sometime around the end of the year and that prices will decline more or stablize - they will probably not go up. And I will make sure that my buyer does not pay more then market value at the time of closing.

To find a great deal on a short sale requires a lot of work up front since up to 76% of short sales don't close. You and your agent have to find the good ones or else you are wasting your valuable time and probably missing the good one - whether you plan to rent before closing or not.

Good luck

If this is not a done deal, leasing the short sale house could be risky. What if the short sale doesn't go through? What is the seller gets foreclosed on? The short sale process could take 3 to 6 months or more.

Your best bet would be to find a 6 month lease with a month to month option after that. This way if the short sale does not go through you are not left stranded while you look for another home. And if you can find a short term rental you could possibly stretch it until the end of the school year if needed.

Hi Melissa,
I have been helping buyers and sellers with short sales for the past 19 months. I can tell you that each bank and each case is different. Expect a minimum of two months prior to hearing anything back from the bank. My shortest sale has been 60 days (as of late) and the longest 9 months.
If you can rent your own home back from the new buyer on a month-to-month basis, that might be your best bet.
Remember, even if the bank accepts your price, there may still be conditions that you or the seller are unwilling to accept.

Best of luck and I hope it all works out positvely for you!

Best Regards,
Carla Rayman, Your Global Agents
Director of International Business Development, Prudential Palms Realty
Sarasota, Florida
Carla@CarlaRayman.com