If you see a home listed at a price too good to be true, make sure to check if it is a short sale or foreclosure. A short sale means the seller’s lender is willing to accept a discounted payoff to release an existing mortgage. Just because the home is listed at a certain price, doesn’t mean the lender is willing to accept that price. Lenders will have their own appraisals performed to determine fair market value.
A reliable realtor with short sale experience can walk you through the following steps:
1. Researching public records to find out who is in title, whether the property is in foreclosure, and how much is owed to the lender.
2. Submitting an offer with communication with the lender. You may need to be pre-approved by the lender. They want to make sure the buyer is able to obtain a mortgage.
3. It may be prudent to have an experienced agent help provide a list of comparable sales to help support your offer.
4. Understanding short sale commissions. Since the lender is losing money, it is likely the lender will negotiate commissions directly with the listing broker who will then share with your agent. It is helpful to have a experience agent help you with this process.
5. Reserving the right to conduct inspections. An experienced agent will help you determine what inspections are required such as pest, roof, sewer, septic tanks, and chimney. Generally, the lender will not pay for these and the buyer will be asked to purchase the property “as is.” It is very important for a buyer to protect themselves with such inspections.
Please click here if you would like to be contacted for further information and a confidential consultation with an experienced short sales real estate agent.
