When is a shot sale a good idea?

Asked by gene, Nashville, TN Tue Jun 12, 2012

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6
Barb Mihalik, Agent, Merritt Island, FL
Sat Sep 8, 2012
First and foremost, a short sale can be a good idea if you're not in a hurry to move and you have the patience and fortitude to wait. The easiest short sales to work with are those that have a price that's already been approved by the bank. Most short sales take a minimum of 3 months to close . If there is only one lien, that always makes things easier. Also, if the bank holding the loan has solid and consistent processes for handling a short sale, that helps, too. It's also beneficial if your agent has had training and experience in handling short sale properties, such as a CDPE designation.. ( CDPE stands for Certified Distressed Property Expert.) The short sale is actually a 3 party transaction between buyer and seller and bank so when you get a bank making the decision as to whether to agree to a short sale and to agree to an offered price, that can take time. To summarize the best short sales:
1. For those who can wait up to 6 months to move in
2. Have a bank approved price and only one lienholder
3. Involve knowledgeable and experienced agents and title companies involved
Otherwise, a motivated seller who's ready to move on may be your better bet.
0 votes
Antonio Vega…, Agent, Saint Cloud, FL
Wed Jun 13, 2012
Currently there are 3 types of listings in the market:
1. Traditional sale - the owner is selling the home via a Real Estate office (straight forward deal, 30 days)
2. Foreclosure - the bank is selling the home at market value (straight forward sale, 30 to 45 days)
3. Short-sale - the mortgagee is trying to sell the home at a lost to the lender before it gets foreclosed (this will require the lenders approval of the offer, which is consider a 3rd person approval. Its a time consuming and complicated deal. Takes 3 to 9 months in average)

The 4th type of sales used to be the "For Sale By Owner"....but i haven't seen one since 2007.

Currently short-sales are over 50% of the market, Foreclosures about 30% and traditionals the other 20%...but it also depends on the area.

Short-sale is a good idea when the buyer is an investor...who has time to wait for the deal to mature...and will lose nothing if it does not go thru.

It is also a good idea for an owner that is aware will be loosing the home to the bank and wants to help their credit from significant damage. Its better than foreclosure, even better if you are able to keep your payments on time until it sells. Was this answer helpful? If so please click on the "green thumbs up" or the "best answer".

Tony Vega
Charles Rutenberg Realty
0 votes
Janet Nation,…, Agent, Baldwin, NY
Tue Jun 12, 2012
A short sale is a good idea if you are behind on your mortgage payments, denied a loan modification and honest with yourself that things won't get better any time soon.

A short sale is a good idea when your mortgage payments are making you so stressed, it is impacting your health and your family relationship

A short sale is a good idea if you have to relocate and there is not enough equity to pay back the lender.
0 votes
Karen Chambl…, Agent, Melbourne, FL
Tue Jun 12, 2012
Gene, there are two situations when I believe buying a short sale makes sense. First, if the sellers are still living in the home and trying to make the best of a bad financial situation, they usually have taken care of the home. Secondly, if you LOVE to fix up distressed homes, a short sale may be for you if it is vacant. In this second situation, the owners often strip the house of anything "strippable" leaving a mess . . . but it is priced accordingly and your sweat equity can quickly increase the value of the property. In both situations, it takes time to close a short sale (3+ months) unless you are a cash buyer and working with one of the banks that is anxious to get it off their books. I recently closed 2 short sales, representing the buyers, in 4 months each. In both instances, the sellers were still occupying the homes and they were in good shape, giving the buyers good value for the prices they paid.

Hope this helps!
0 votes
Daniel Barto, Agent, Naples, FL
Tue Jun 12, 2012
As a buyer, a short sale could be a good idea of you have time to loose and don't mind watching other potential deals pass you by. If the short sale is approved, that time can sometimes be shortened. If you are an investor that doesn't mind waiting for the right property, it can be a good idea. Generally speaking, if you are a owner occupant looking for your primary residence, not such a great idea. I say that because most don't go through or take very long and price almost always changes; sometimes a bit, sometimes alot. The process depends on so many people knowing how to handle it, many people still dont. If you do, get an experienced agent/broker that has been in the biz for the past 5 years full time and works with distressed property. They will point you in the right direction. In many markets, foreclosures and even new construction is a better deal depending on your specific requirements. Best of luck to you!
Danny Barto
GalleonProperties.com
Web Reference:  http://GalleonProperties.com
0 votes
Lawrence Fle…, Agent, Melbourne, FL
Tue Jun 12, 2012
There are many reasons for a short sale...the main reason you need to sell and you owe more on your home than what it is worth in todyays market. Here is a site with some great info about short sales: http://www.brevardrealestateinfo.com/short-sales/

Thanks,
Larry Fleckinger
321-252-9767
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