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What's the typical process when buying a short sale?

Asked by Trulia, San Francisco, CA Mon Mar 5, 2012

How long does it take? What are some pitfalls?

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Answers

2
The first thing you need when buying a short sale is patience. Short sales can take from 3-6 months to close.
The process is similar to a regular sale, you make an offer the seller and buyer agree to price. They contract is reviewed by the attorneys, home inspection is performed, deposits are given. Then you wait for the bank to review the offer. Once the bank accepts the offer the buyer has 30 days to close.
Now every short sale is different like every sale is different.
Let me know if you have further questions.

Thanks!

Best regards,



David J. Bistany,CRS, SFR, Green
Everything He Touches Turns to SOLD
Liberty Realty, LLC
525 Washington Street
Hoboken, NJ 07030
NJAR Circle of Excellence Award Silver Level 2005-2010
Hoboken Jersey City Realtor
http://www.LibertyRealty.com
Office: 201-222-2900
Direct: 201-852-3291
Fax: 201-222-2811
3 votes Thank Flag Link Mon Mar 5, 2012
As David said, every short sale is different as each has it's own turn around time. I've seen some close in as little as 2 weeks (all cash buyer) and some take as long as one full year!

Typical short sales in this area, the attorney's will ask for a minimum of 3 - 6 months to allow them enough time to get bank approval.

The short sale process is similar to a regular purchase, you will still enter attorney review, conduct a home inspection (although you should factor in repair costs into your offer price since the seller has no money to conduct repairs for you) turn over deposits, and have a mortgage commitment date.

Some tips
Understand market value. Agents many times advertise a low asking price to entice buyers, but base your bid on market value, not the list price. You'll have a better chance at getting acceptance.
Conduct your home inspection upfront, or understand that your offer price cannot be lowered.
Your offer price will not always be accepted, remember it's subject to bank approval, many times you could be countered.
Be ready and apply for your mortgage as soon as you get the go. Once the bank does accept, they will want you to close shortly after.
Work with short sale experienced professionals. Work with agents who know the right questions to ask and attorney's who understand the process.
0 votes Thank Flag Link Fri Mar 9, 2012
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