I do not understand short sales, when I decide to make a offer on something they say something about short.

Asked by Naydine, Riverside, CA Thu Nov 6, 2008

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Suzanne White, , Tampa, FL
Tue Jan 18, 2011
Keep in mind if you are seeking a short sale be prepared to get fustrated even if you have lots of time to wait for no answers. They may tell you its once price and you find out after 6 months of waiting they will not accept your offer. Meanwhile, you have passed up some great homes that fit your needs. Here is a helpful article: http://rismedia.com/2010-02-18/short-sale-buyers-face-diffic…
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Tammy Hayes, Agent, Port Charlotte, FL
Wed Oct 20, 2010
Short Sales A short sale describes the sale of a property by a financially insolvent homeowner who is facing foreclosure for less than the value of the outstanding loan. If a homeowner is interested in pursuing a short sale with their lender they will need to have the lender's consent and approval.
• Lender's consent and approval required.
• The lender accepts the sale as payment in full for the loan.
• The property owner escapes foreclosure, but receives no funds from the sale
• There can be no equity in the property
• Seller cannot bring money to the closing.
• Lender does not report foreclosure to the credit bureaus.
The lender will require various documentation. The incentive for the lender is to remove the account from their books before the loan becomes a problem. It can also cost a lender $25,000 to as much as $50,000 in order to send the property through the foreclosure process. Technical requirements for a short sale: (May differ from lender to lender)
• Owner must demonstrate hardship/financial insolvency (i.e. loss of employment, illness, divorce, catastrophic illness, death of a spouse).
• Seller must prepare a hardship letter asking lender to accept short sale.
Documentation that may be required by lender to determine if owner qualifies for a short sale.
• Listing agreement with Realtor showing the property is on the market for sale.
• Comparable market analysis which includes sales and listings
• Bank statements
• Pay stubs
• Tax returns
• Purchase/Sale Agreement
There are drawbacks to the short sale.
• A deficiency balance could be charged off which could result in negative credit bureau reporting.
• If the cancelled portion of debt exceeds a certain amount, the homeowner is required to report the forgiven amount as income on his or her tax return.
As always, any property owner should seek legal and financial advice before entering into this type of transaction.
If you would like more information on Short Sales, please contact me.
Tammy Hayes, Realtor, Sandals Realty, 941-276-6185 tammyhayesre@gmail.com
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Tammy Hayes, Agent, Port Charlotte, FL
Wed Oct 20, 2010
Buying a Short Sale

Buying a short sale is not like buying a property in a traditional way. A short sale may have some risk but it also can be very rewarding. When you are searching for a short sale you will want to make sure you are prepared. Here are some things you will need to consider.

First of all, you need to make sure that you have enough time. It takes anywhere from 30 days to 6 months or even more to get an answer on a short sale. It really depends on many factors. The bank may come back with a counteroffer or reject your offer completely. In some instances you may not even hear back from the bank at all.

Short sales take a long time because the bank has to review it and they are back logged with many short sales and don't have enough coverage to complete them in a timely manner. The bank typically is willing to work with the seller and buyer on short sales to help avoid foreclosure.

One of the benefits of buying a short sale is that the bank is typically willing to accept less money for the property because of the time and risk involved. So you generally are getting the home at below market value.

If you have the time to wait, a short sale is a good way to go. One thing to be sure to ask when purchasing a short sale is, "who is handling it?" Is the Realtor an experienced short sale expert? Or is the listing agent using a Short Sale company that strictly focuses on short sales? By having someone with knowledge and expertise in short sales, it will make the process go much smoother and faster.

Tammy Hayes, Realtor, Sandals Realty, Punta Gorda, FL tammyhayesre@gmail.com
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KC Horton, , Brooksville, FL
Tue Oct 19, 2010
Here is a primer on short sales.

The Truth about Short Sales
With all the homes for sale out there and the many deals available, many buyers looking for a deal concentrate on short sales. This MAY not be in their best interest. First, some definitions………..
Short sale, Pre Foreclosure, Forclosure: All mean the same thing. The home or condo is worth less than the amount the homeowner owes to the bank. There is a cloud on the title. The real estate office that has the listing has picked what they consider to be an acceptable price and have listed the home at that price WITH NO ASSURANCE THAT THE BANK WILL ACCEPT THAT AMOUNT. In fact, they write in the listing “subject to third party approval”. The home can have an OFFER put in on it.
Bank owned, REO: Both mean the same thing. The foreclosure process is over, the title is clear and the home can be BOUGHT AND CLOSED ON.
Seller owned: The home can be BOUGHT AND CLOSED ON.
Some drawbacks to short sales
• Short sales are generally vacant and neglected.
• Short sales have been without power and air conditioning for sometimes a year or more in our humid subtropical climate (can you say MOLD).
• Short sales have not had interior pest control (roach & bug Heaven)!
• Short sale lawns are infested with weeds and chinch bugs. Lawns are further stressed due to lack of water, fertilizer & pesticides. ( let’s face it, most of these lawns are DEAD).
• Many short sales have been stripped of their appliances and fixtures.
• Some short sales have been damaged, even booby trapped by their former owners (sometimes unseen).
• A short sale is sold AS-IS, what you see (or don’t see) is what you get.
• Many short sales do not come with a full warranty deed.
• A short sale has a 1st mortgage AND many times a 2nd mortgage. Some even have a home equity loan as a 3rd mortgage. Consequently, some short sales have as many as three separate banks/negotiations to be dealt with in order for a successful closing to take place. A short sale can have multiple competing offers unbeknownst to the potential buyer(s).
• A short sale has a loooonngggg period before the bank responds to the offer sometimes as little as a month but can be as long as of 4-5 months for ACCEPTANCE BY ALL PARTIES.
• A short sale, even after acceptance of the offer has NO GUARANTEE of a successful close.
• A short sale is NEVER guaranteed to close, but if it does, be prepared to wait as little as 90 days from start to finish or as long as a year or more!
• With a short sale, everything can look good for a long time and then COLLAPSE AT THE LAST MINUTE.
• Many buyers get “antsy” and back out of their short sale offer so they can buy a home and close on it after wasting their time and money for inspections on the short sale
For a smooth buying experience, call Sue & Kevin Horan of Horan Realty Group @ 727-992-5566 or 727-967-1756
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Lana Robbins…, Agent, Beach, ND
Mon Aug 3, 2009
A short sale describes a process between the lender and the seller. The lender(s) agrees to accept less than the full amount due on a mortgage. It does not describe the length of time that it takes to close.

In my experience working with short sales in the Tampa Bay Florida area on the selling and buyers side respectively the closing time can vary. They vary just as lenders do. Sometimes it can take two months. Sometimes it can take six months.

I highly suggest that anyone looking to purchase a home that is a short sale to consider that it may take awhile to close.

~ Lana Robbins
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Shonda Campa…, Agent, Jacksonville, FL
Thu Nov 6, 2008
A short sale occurs when the proceeds of a real estate sale fall short of the balance owed on the property. In a short sale, the bank or mortgage lender agrees to discount a loan balance due to an economic or financial hardship on the part of the mortgagor. This negotiation is all done through communication with a bank's Loss mitigation department. The home owner/debtor sells the mortgaged property for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender, sometimes (but not always) in full satisfaction of the debt. In such instances, the lender would have the right to approve or disapprove of a proposed sale. Most Short Sales leave a deficiency balance for which the Mortgagor / Borrower is still liable. In 99% of all cases it is not a settlement-in-full.

You can get some great deals, if you do not mind the wait. A short sale can take anywhere from 2 weeks up to 6 months to get final approval.
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Paul Whiteho…, Agent, Melbourne, FL
Thu Nov 6, 2008
A short sale is when the mortgage(s) owed on a home is greater than the value of the property i.e. the seller is "short" of funds. The banks can take weeks or even months to reply to an offer on a short sale home because they want to wait for the best offer. Always consult a Realtor.
Web Reference:  http://www.paulsold.
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john doe, Home Buyer, Wendover, KY
Thu Nov 6, 2008
A short sale can be a great way to build equity in a home up front. A short sale is subject to 3rd party approval, meaning the bank. Sometimes banks will agree to accept an offer that is less than the full payoff amount. They might want the home listed on the market until they feel they have received the best and highest offer and not accept the first offer that comes across their desk. If you have a specific time frame you want to move into a home, it will not work on a short sale. You work in the bank's timeframe.
Web Reference:  http://utahhomemenu.com/
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