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Leanne, Home Buyer in Atlanta, GA

Advice on purchasing a "short sale" of a new home?

Asked by Leanne, Atlanta, GA Mon Sep 8, 2008

What key things should one beware of or look for in this type of transaction? It is a small builder going under and needs to get rid of his inventory. Just don't want to walk into a deal like this blindly. Thank you

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Hello, on short sales you must be prepared to wait....and wait and wait...and....well you get the jest.Short sales are notorious to take a LONG time.If there is only one lender involved it CAN go quicker.I would strongly suggest a full title search also to make sure there are no liens on the property that you are unaware of.If you are in a state that Attorneys do the title and escrow use them also for advice on the process and to look everything over!

Good luck to you on the Short Sale!!
1 vote Thank Flag Link Mon Sep 8, 2008
This one can be tricky. First identify if the lenders are looking to close out the entire inventory or will accept individual sales. Second and most important has the BPO (Brokers Price Opinion) been completed and if so do they know what it is and was it done on each unit. These transactions do take time so be prepared to wait 45 to 60 days after submitting your offer. Good luck.
0 votes Thank Flag Link Fri Sep 19, 2008
Mainly that it could take a very long time to hear if your offer has been accepted. Many short sales do not go through as buyers can't wait for the banks to make their decisions. If you need the name of an attorney that handles short sales, contact us offline at longislandrealtors@gmail.com
0 votes Thank Flag Link Fri Sep 19, 2008
When purchasing a short sale, you must be willing to be patient. The banks do not move quickly with their responses. Literally, you could wait weeks. The longest I personally have seen a Bank take was 5 months until they gave the buyer an answer. Short sales are not a great idea if you need to move quickly. You will not have any type of Home Warranty provided by the builder. You will definitely want to do a home inspection, but that really goes with any home, new or resale. In addition to the home inspection, you could buy a separate Home Warranty for around $500. Typically that is something that is negotiated into the sales contract, but may or may not happen when dealing with the bank. At closing, you will definitely want to purchase an Owner's Title Insurance Policy. That is critical in any home purchase too. It protects you from liens that were not discovered during the title search. Make sure you are working with an Agent who can represent you and protect your best interests. Best wishes.

Jen Bowman
Success Realty
404-456-5024
Web Reference: http://www.JenBowman.com
0 votes Thank Flag Link Fri Sep 19, 2008
Leanne,

I'm surprised by the answers. THERE IS A LOT TO BEWARE OF!

Namely, the bank. Are you sure the bank will accept the short sale? Did the listing agent put together the package or the builder himself? Are there any other liens of the property?

Sure you can have it inspected, appraised, poked and prodded, but the difficulties with short sales arises from the uncertainty with dealing with the bank. Their response time is long and usually uncertain, making pinpointing a closing date nearly impossible.

I usually tell my clients, if you can buy anytime between now and 6 months from now, then a short sale might make sense to look at. If you have to move by a specific date, you might want to avoid them.
0 votes Thank Flag Link Tue Sep 9, 2008
Joshua Jarvis, Real Estate Pro in Duluth, GA
MVP'08
Contact
Truly nothing have your agent submit an offer, you are protected by inspector, appraisal,
http://www.lynn911.com http://www.homes-for-sale-dallas.com
Web Reference: http://www.lynn911.com
0 votes Thank Flag Link Mon Sep 8, 2008
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