what is short sale?

Asked by Blacksleepycat, Orlando, FL Sun Jul 25, 2010

i want to buy a short sale home
can anyone tell me the steps how to do it?
thank you

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Kathi Adkins, Agent, Altamonte Springs, FL
Sun Jul 25, 2010
When your home is worth less than the mortgage you owe on it, to sell it would be considered a short sale. If you find a buye,r your mortgage lien holder would have to agree to accept a "short" on the amount owed them. So if the house mortgage is $120K and it is only worth $50K, the bank would be shorted $70k. The bank (or mortgage lien holder) must agree to this price for the buyer to be given clear title to the house at closing. Using a Realtor that is experienced in short sales would be the way to go. They could walk you through the process. The bank will pay them the commission to seell it not you!
First in the process...call your mortgage lender and tell them you want to sell your home and it will be a short sale. Ask them if they can send you a package or give you the list of documents you need to gather. You will have to provide your financials and a hardship letter. If you have income and could afford the home, be aware that the mortgage company could ask you to contribute to the loss. It can be a very long process. I am working on 9 at this time and each bank is different. Hope this helps. Be glad to answer any other questions for you! I have some great info on http://www.kathi.com
1 vote
Rick Wells, , 32164
Tue Jul 27, 2010
your 1st step is to find a reator who really understands the process=In FLORIDA usually a short sale is on it's way to becoming a lender owned. The owner is in the home and hopes to sell the home before the lender foreclouse's. (FORECLOSURE CAN TAKE 2YS?)The homeowner hopes to get debt forgiveness from the lender if they coperate in the sale, keep the home up etc. The problem seems to be that different lenders require different things & can be hard to deal with "not all" this has improved alot. The realtor you deal with needs to really understand the process, and find out what the lender needs are??? & will communicate them.The realtor can screw this up before it really gets starter, if they do not get the "correct " info to the lender the 1st time, you get 6mos closing's. Our market here = the prices of short sales and reg property are now not all that different? the real buys are== lender owned & Fannie Mae etc'
0 votes
Don Tepper, Agent, Burke, VA
Sun Jul 25, 2010
Three other points:

First, Short sales can take a long time to transact. A "normal" sale might take 45-60 days. A short sale can take 4-6 months or more. I've know plenty that have taken 8, 10, 12, or more months. That's due to the lender taking a long time to decide whether to permit the short sale.

Second, because the transaction is contingent upon lender approval, a lot of short sales don't go through at all. The lender says "no."

Third, unless you've identified a specific home you want to make an offer on, don't limit your search to short sales. They're not all as difficult as I've suggested above, though many are. More to the point, though, you'll be limiting your options if you look only at short sales. If you're looking for bargains, moreover, some short sales are, but many aren't. Same with foreclosures. Just because a home that sold for $500,000 a few years ago is now listed for $350,000 doesn't make it any bargain. The question is: What's the home worth now? Not: How much of a price reduction from the last sale am I getting?

Hope that helps.
0 votes
Alan Martin, Agent, Orlando, FL
Sun Jul 25, 2010
my team have completed around 40 short sales this year.

If you are looking for an experience short sale Broker then I can help 407 832 4888
0 votes
Antonio Vega…, Agent, Saint Cloud, FL
Sun Jul 25, 2010

In the last 30 days, for all of Orange county there were 1475 closings.
Of those 1100 were Foreclosures or Traditional sales (75%) and of those 75% closed in 60 days or less.
there were 375 Short-sales that closed (25%) and only 34% closed on 60 days or less. Over 50% took more than 120 days to close.

Unless you have time to sit an wait, often to be disappointed at the end, a Foreclosure or Traditional sale is a much more certain choice when purchasing a home.

Tony Vega
Charles Rutenberg Realty

0 votes
Marilyn Rank…, , Orlando, FL
Sun Jul 25, 2010
Reference http://www.cdpe.com, on this site you will fine very good information!
Web Reference:  http://www.marilynrankin.com
0 votes
Darin Princi…, , Orlando, FL
Sun Jul 25, 2010
Hello here is the standard definition
A short sale is a sale of real estate in which the sale proceeds fall short of the balance owed on the property's loan.
It often occurs when a borrower cannot pay the mortgage loan on their property, but the lender decides that selling the property at a moderate loss is better than pressing the borrower. Both parties consent to the short sale process, because it allows them to avoid foreclosure, which involves hefty fees for the bank and poorer credit report outcomes for the borrowers.
This agreement, however, does not necessarily release the borrower from the obligation to pay the remaining balance of the loan, known as the deficiency.

There are also Bank Owned or REO (real estate owned) these are homes that have already been foreclosed on and are for sale directly from the bank.

You can see me link to me website for an instant search of short sale and bank owned homes.

Feel free to contact me for a more in depth explanation.

Have a great Sunday
0 votes
Broker Dave, Agent, Orlando, FL
Sun Jul 25, 2010
In a nut shell a 'Short Sale' is a term that means the home is being sold for less than what the current owner owes the bank which should be todays market value of the home.

With the right experenced Realtor with you it should have no affect to you as a buyer other than time to get an approval from the bank they will accept the lower offered price.

Hope this helps,

Dave Lowe, Broker
GRI, ePRO, Realtor

Community and Family Values
Web Reference:  http://OrlandoHomeStore.com
0 votes
Sharon Molnar, , Jacksonville, FL
Sun Jul 25, 2010
Hello BlackSleepCat,

The first thing to do is find a good real estate agent that is experienced in short sales. Your agent will walk you through the steps. This is the easy part. The hard part is being prepared to wait to close on the home. Purchasing a short sale takes time. All the same steps as purchasing a home that is not a short sale.
Find a good short sale agent
Get pre-qualified, but perferable pre-approved from lender
Find a house you want to make an offer on
Make an offer
Wait for the sellers lender to approve the short sale. Depending on the lender it can be as quick as 45-60 days or as long as????
0 votes
Alan Martin, Agent, Orlando, FL
Sun Jul 25, 2010
in simple terms it is where the proceeds from the sale of the home will not cover all the expenses assosiated with selling . Including the loan

so if the loan is bigger than the proceeds then there will be money ' sort ' at the closaing table and the sellers lender will have to take less to make it happen
0 votes
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