Javier Meneses,
Mortgage Broker or Lender, Woodbury, NY
This could take forever to type it all up. Best thing you can do is talk to a Realtor Estate Professional who is ACTUALLY experienced with short sale transactions. Meet them face-to-face and ask them to walk you through the entire process and get asnwers to your questions. Nothing like it!
If you need someone, I'm always available to meet face-to-face...
Javier Meneses
Sterling National Bank
631-659-2011
If you need someone, I'm always available to meet face-to-face...
Javier Meneses
Sterling National Bank
631-659-2011
Web Reference: http://www.sterlingnational.com/jmeneses/home.asp
Caroline Farnsworth,
Agent, Maplewood, NJ
The big issue with short sales is lack of control over the closing timeframe. The bank will work on their own timeframe and you have no choice but to wait for their response on all terms. That said, if you are flexible on closing date and do not have a deadline on when you must close, you can usually get a good deal on a short sale, mostly because most other buyers cannot wait indefinitely for a sale to close. If you are flexible on closing date, there are lots of short sale deals out there.
Anna Brocco,
Agent, Nassau County, NY
Short sales are listed with brokers, therefore work with an agent of your own, he/she will be your best guide. Keep in mind that not all short sales are such great bargains, therefore don't overlook some traditional sales during your search, as some may end up being a better buy.
Mitchell Feldman,
Agent, Brooklyn, NY
Dear Ring Ring:
Buying a home that is a short sale is the same as buying any other house, the only difference is that the whole deal is subject to third party approval. That third party is the bank that is holding the mortgage for the current homeowner.
In a normal transaction, if the current seller has a mortgage, when they sell their home it is paid off in full at the closing table and the seller walks away with the difference. In some cases, a homeowner's mortgage may be higher than the value of the property. This typically would be the case with a buyer who purchased a property at the height of the market (2007) with a no money down type deal. Back then the banks would lend you up to 106% of the value of the property. You could literally purchase a home without spending any of your own money at that time (you cannot do that any more, although US military vets can still get a mortgage with no money down). Often times those same purchasers had variable rate mortgages (which went up a great deal over time!). Then, when the US economy collapsed back in 2008 and home values went down, many of these people could not afford to pay their mortgage or just plain didn't want to because the value of their home was now so much less than what they owed.
This is how short sales started. As a potential purchaser of a short sale type home, you have to keep in mind the following:
1) Even though the seller accepts your offer and goes into contract with you, it does not guarantee that you will get the house. This is because the bank that holds the current mortgage has the final say.
2) The larger the disparity between what is owed to the bank and how much the bank will receive at the closing table... the less likely it is that the bank will approve the short sale.
3) Banks determine how much they are willing to take based on an independent appraisal of the property. If the appraised value is significantly higher than the price you are paying, the deal will most likely be declined.
4) It can take a long time to get the answer from the bank. Sometimes it can be as quickly as 60 days, other times it can drag on for a year. During this time you will be obligated to the seller and not able to purchase another property due to your contractual obligation. Because of this you should always have a time limitation in the contract of sale (say 90 days) whereby you have the option to pull out and get your down payment check back if things do not seem to be working out right.
5) When purchasing a short sale, you should put as little money down at the signing of the contract as possible, your lawyer can help you with this.
If I can be of further assistance, please let me know. Good luck!
Sincerely,
Mitchell S. Feldman
Associate Broker/ Director of Sales
Madison Estates & Properties, Inc.
Office: (718) 645-1665/ Cell: (917) 805-0783
Email: MitchellSFeldman@aol.com
Buying a home that is a short sale is the same as buying any other house, the only difference is that the whole deal is subject to third party approval. That third party is the bank that is holding the mortgage for the current homeowner.
In a normal transaction, if the current seller has a mortgage, when they sell their home it is paid off in full at the closing table and the seller walks away with the difference. In some cases, a homeowner's mortgage may be higher than the value of the property. This typically would be the case with a buyer who purchased a property at the height of the market (2007) with a no money down type deal. Back then the banks would lend you up to 106% of the value of the property. You could literally purchase a home without spending any of your own money at that time (you cannot do that any more, although US military vets can still get a mortgage with no money down). Often times those same purchasers had variable rate mortgages (which went up a great deal over time!). Then, when the US economy collapsed back in 2008 and home values went down, many of these people could not afford to pay their mortgage or just plain didn't want to because the value of their home was now so much less than what they owed.
This is how short sales started. As a potential purchaser of a short sale type home, you have to keep in mind the following:
1) Even though the seller accepts your offer and goes into contract with you, it does not guarantee that you will get the house. This is because the bank that holds the current mortgage has the final say.
2) The larger the disparity between what is owed to the bank and how much the bank will receive at the closing table... the less likely it is that the bank will approve the short sale.
3) Banks determine how much they are willing to take based on an independent appraisal of the property. If the appraised value is significantly higher than the price you are paying, the deal will most likely be declined.
4) It can take a long time to get the answer from the bank. Sometimes it can be as quickly as 60 days, other times it can drag on for a year. During this time you will be obligated to the seller and not able to purchase another property due to your contractual obligation. Because of this you should always have a time limitation in the contract of sale (say 90 days) whereby you have the option to pull out and get your down payment check back if things do not seem to be working out right.
5) When purchasing a short sale, you should put as little money down at the signing of the contract as possible, your lawyer can help you with this.
If I can be of further assistance, please let me know. Good luck!
Sincerely,
Mitchell S. Feldman
Associate Broker/ Director of Sales
Madison Estates & Properties, Inc.
Office: (718) 645-1665/ Cell: (917) 805-0783
Email: MitchellSFeldman@aol.com
Web Reference: http://www.MitchellFeldman.com
Tina Lam, ASP, SFR,
Broker, San Jose, CA
Buying a short sale house is similar to a regular purchase as you're still making an offer to the seller and hoping yours is the one accepted for a deal. Being a short sale transaction, it just adds an extra step of getting a bank's approval. The listing agent will handle that process and will likely request additional paperwork to be signed. The bank may counter back with a different price than what the seller accepts, but that's due to the bank's determination of how close your offer is to the current estimated market price.
Otherwise, the prior response is a pretty good description of many short sales.
Otherwise, the prior response is a pretty good description of many short sales.
Web Reference: http://www.archershomes.com
