Buying a Short-Sale
If you’re considering a short sale purchase, you need to have time and you should have a team!
Short sale purchases are much like a normal real estate purchase once you get the sellers lender approval. Getting said approval is the difficult thing! Are the sellers asking that you work with their attorney, title company, Realtor in the process of getting approved? That’s normal but if it’s the Realtor doing the negotiations with the seller’s lender…do they have the time, resources and energy it takes to accomplish this task? It can be like having another full time job just getting in contact with the sellers lender!
When you’re the buyer, you have to “dance with who brung ya” and that means relying on the “team” (or lack of one) that the sellers are dealing with…The team needs to interact closely with the sellers lender to get the job done. If your real estate agent isn’t comfortable with who the seller’s side has assembled…maybe you should just move on! The process of closing on a short sale home even with the right people can take months…literally!
The sellers might agree to use YOUR team for the negotiations, that’s not all too difficult to accomplish paperwork wise…it’s just an agreement to disclose and release of information for them to complete and then YOU may have more control and a better chance. Getting the sellers to agree however is the difficult part. Often they have already established a relationship with someone who introduced the concept to them and they feel obligated to stick with them. Nothing wrong with loyalty but that loyalty has a big impact on YOUR purchase.
Let’s assume the approval is issued and it matches your offer price…The terms of the agreement are acceptable to the seller…now, you close just like any other deal BUT you may only have 30 days to do so!! You MUST be working with a lender that can move quickly and understand that often there are NO extensions. If the closing date comes and YOUR lender is not ready… You lose the deal…simple as that!
Short Sale approvals are given once the sellers lender values the house by way of a BPO (Broker Price Opinion) completed by a local Realtor that is neutral and has no stake in the transaction. There is a fee paid to this Realtor to complete the BPO and the sellers lender relies heavily on this report when either accepting, countering or declining your offer. Right or wrong, the BPO is everything!
Many approvals are given with terms for the seller to comply with (Promissory Note, cash settlement, etc) and the seller may NOT agree…now you stand to lose as well since the home will quickly be foreclosed on. History is proving however that once initiated…short sales DO close. They close AT market value…No real “Deal” at all so you may ask why even set out to look at short sales? The answer is that many people AVOID them and you might find a great house!! You’ll just NOT get a deal and you WON’T close quickly.
So in summation…wait a long time and once approved MOVE FAST!
TCREG has been closing short sales since 2005…The TEAM we use is available to you! We rely entirely on Lane Baron of Element Funding (954-868-1826) for fast, reliable and competitive short sale financing and Maria Molina of Transfer Title (305-898-3748) for our short sale negotiation/closing process.