If you have a price in mind, or think that the house is a great value, you might go ahead with an offer while it is still a short sale. That way the bank does not have to go through the long, drawn out foreclosure process. The other potential issue is that if the bank does foreclose, there is no guarantee that it will be offered on the open market. It may be purchased in bulk by an investor before ever being listed for sale by the bank.

As for the short sale process being difficult, it really depends on the bank. Some banks have come to terms that it really is more efficient to take the offer (if they get one).

I have submitted offers directly to the trustee to forward to the seller so that when the home is finally foreclosed upon my clients get the home without it going to market. Often that is the clincher for the deal. Most agents never think to do this. If you are going nowhere with the agent and the two banks for example, why not go the back door?
Call me and i will tell you what to do.
Peter

You've received some good advice Corene. One additional note is that banks typically would rather take the short sale route than the foreclosure route. Short sales are more advantageous to everyone involved, typically, because the courts are not involved. Judicial services are time consuming and very costly for the banks, likewise are the repairs needed to market the property, commissions, taxes that accumulate, carrying costs including electric and gas, etc. For the seller, foreclosures are not so easy on the credit. Whereas a short sale, though it is a blemish on the credit report, it is not nearly as hurtful as a foreclosure. You can get short sale closed in as little as 14 days but it really takes due diligence on all parties involved and essentially all the guns loaded and ready to fire. If you're really interested in this property perhaps the lenders should be contacted to find out their timeframes.

Corene,

I answered your questiion earlier but I wnated to make sure you are aware of the $7,500 first time home buyers tax credit that woulld be availiable to you if you are a first time home buyer.

I would be happy to e-mail this information to you if you would like.

Thanks
Mark

I agree with the other answers. If you really want this house, make your offer now. See if you can find out if the short sale has been approved already. There could have been a buyer before you that dropped out of the deal, but the process could have already been started with the bank. If it has, this will speed up the process. If you decide to wait until the bank forecloses and sells it, you could be waiting a while. With some of the bank owned properties I list, it can take from 3-5 months before the property actually makes it on to the market. Then you may have more competition, since like you, more buyers want to work with REO's than with short sales. Finally, with a bank-owned property, many times the bank requires stricter contract terms and shorter timelines. So again, depending on where they are at in the short sale process, you may be better off making on offer now, especially if this is the home you really want.

Good luck to you, and whatever you decide I hope you get the house you want.

Crystal Parrett

Hello Corene. If you really love this house, then make your move now. Ask yourself how'd feel if you find out that someone else made an offer now and got it approved. Would you be alright with it or will you regret not having given it a shot yourself. The worst that can happen is that the bank won't approve it. Your agent should ask the listing agent how he/she handles short sale offers as not all agent do the same thing once they have received an offer. Some collect offers and submit all the offers to the lender and let the lender decide and others will have the seller pick the best offer and then send only that offer to the bank for consideration. It's important for you to understand the difference so that you know what to expect as you'd write up the offer differently depending on how the listing agent handles the offers.

While it is true that short sales can take a long time, but to me it appears that there's no real disadvantage to you as you'd have to wait anyway until the bank takes the property back which will not happen for a few more month and then you'd have to wait again until the bank puts the property back on th market. The only questions is, are you waiting with an offer on the table or are you just waiting for it to come on the market as a bank owned property in hopes that the price will be lower than what you'd offer now. In the end, what course of action you take will for the most part depend on how much you want this house. I'd say go for it now or don't look at short sales anymore as you'll deal with the same dilemma on every short sale propert. I hope this makes sense.

Good luck to you.
Best regards,
Ute Ferdig

Hi Corene,

In my opinion some short sales are simple some can take for ever. First of all is it an approved short sale.
Have they had any offers that the bank has accepted and then the buyer backed out. In those situations the bank should be able to move quicker. Also I believe that the listing agent's role is very important and that they have done short sales before and really know what they are doing.
I think that if you want the house you have nothing to loose by making an offer.The reason I say this is typically your deposit will not be deposited until after the bank signs your offer. That is when you start your contingency period and start scheduling your inspections make sure a short sale addendum is included in your offer.

I hope I have anwered your question

Mark

Do you want the house? Short Sale in my opinion is easier than a foreclosure. You are getting a house that is less than what the owner owes. Usually the bank will take a fair market value, they understand the market has change and that the house in this market is not worth the amount owed. Long time to process; time goes by anyway. The real question is why do you want this house?