As i browse through the list of homes for sale i see that some are listed as short sale.
What does this mean for the buyer?
Is this good or bad?
The house has a mortgage of $200,000. It has a value of $150,000. If you sell it for what it is worth, the owner is "short" $ 50,000. The bank and the seller negotiate to determine how much both of them will agree to lose. This negotiation takes 90 days because many banks have only 2 employees handling 1,100 short sales.
This does not turn out well for most buyers.
March 9th, 2010 at 8:55 pm
Its when you sell your home for less than the balance owed on your mortgage. Its a very common practice these days given the decline in home values. Try to get a modification from your lender before considering this option unless you have to move.
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March 9th, 2010 at 9:12 pm
A short sale is when a home is sold for less than what is owed as far a mortgage is concerned………….a sign of our faltering economy.
It is great for a buyer but, expensive for a seller.
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March 9th, 2010 at 9:49 pm
The house has a mortgage of $200,000. It has a value of $150,000. If you sell it for what it is worth, the owner is "short" $ 50,000. The bank and the seller negotiate to determine how much both of them will agree to lose. This negotiation takes 90 days because many banks have only 2 employees handling 1,100 short sales.
This does not turn out well for most buyers.
References :
March 9th, 2010 at 9:54 pm
What a short sale means for the buyer depends on what is meant on the listing. For some listings, it means that the seller is willing to consider a short sale. For others, it means that everything except the contract from a buyer has been submitted.
If you’re dealing with the former, it will usually take at least 30 days to get the lender to begin to negotiate as they have to open the file, assign someone to it, order a broker’s price opinion or appraisal and then get that information back. After that, it can be another 30 days to approval and then time to close.
If you’re dealing with the latter, it can be much faster because the lender is ready for the offer to come in and most of the prep work has been done. You could be closing as soon as 45 days after submitting your offer to the seller’s lender for approval.
Of course, all of this depends on the quality of the materials submitted and the skill of the person or people negotiating. You’re better off getting yourself educated on how to present the short sale and negotiate it or hiring a negotiation firm to do it for you. To get educated, go to http://www.theshortsalegoods.com and check out the products offered there. To hire a negotiation firm, you want one that doesn’t charge its entire fee up front and doesn’t charge you anything if unsuccessful. A good one is Mortgage Mitigators. http://www.mortgagemitigators.com. Check them out. Good luck.
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