What is a short sale? In short, no pun intended, a short sale is when the sales proceeds of a property fall short of the balance on the mortgage loan. Therefore the seller owes more money than what they are selling for.
Why would a lender agree to a short sale? If the owner stops making payments and lets the property go into foreclosure, it could take several months for a bank or lender to take the property back. When the lender takes control of the property, they still have to put the house on the market and it could take months until the house is sold. Foreclosure is a very expensive process and it is one good reason why banks would rather short sell than to go through a foreclosure.
Short sales are becoming increasingly more prevalent in the housing market. Why would this be a good option for you? Lets find out!
- More likely to get a better deal than a traditional sale!
- Get a great mortgage rate!
- Better condition than foreclosed homes
- Go through the home buying process easily! (with an experienced real estate agent)
Well that sounds great, but whats the catch??? The homes are sold in AS-IS condition and the process can be drawn out a little as the time frames are uncertain. Additionally the approving lender rarely agrees to pay for any extras that a regular seller may agree to. This could mean higher closing costs for the buyer. The buyer would have to pay those costs such as the cost for inspections and repairs.
But if you are not bound to a certain time frame and you would like a good deal on a house, then a short sale may be right for you! If you would like to start searching for short sales, traditional sales or foreclosures, please visit my website at www.MrKniceGuysHomes.com
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