What To Expect When Purchasing a Short Sale Property

Sunday, May 19th, 2013

If you are in the market for a new house, then you may have seen some pretty attractive prices out there for homes.  You get excited at first and think you found a diamond in the rough.  Then you see the term “Short Sale” on the description.  A short sale property isn’t something you should shy away from, but it does come with a different set of rules than a conventional home purchase and you should be aware of them before you get too excited.

A short sale simply means that the sale price of the real estate is less that what is owed by the current owners.  The lien holder agrees to release the lien hold on the property for an amount that is less than the current lien.  When purchasing a short sale, the process is often times longer and more drawn out, but the reward is a good price on a home.  If you see a short sale and fall in love with the property, you can make an offer to the current owners.  Most times, because it’s a short sale, the homeowners will accept the offer.  After the offer has been accepted, the homeowners take the offer to the bank.  The bank needs to approve your offer before you can move forward.  They will either approve it or reject it, but it can take them a few weeks to a few months to give you an answer.  So if they end up rejecting it after waiting 3 months, then it can become very frustrating for the buyer because they may have lost out on a few other nice opportunities while they were waiting.  The good news is that once the bank approves the offer, then most of the time, the transaction can proceed as a normal real estate transaction.  If you are in a rush to purchase real estate, then a short sale may not be the right option for you.  Patience is a virtue when it comes to purchasing a short sale.

As with any real estate transaction, it’s very important to have a real estate lawyer involved in the process.  Short sales are no exception.