Whether you own a property in distress or you’re looking to make a good
investment, buying and selling short sales can be a frustrating process. The
best-case scenario is that sellers reduce their debt and buyers get a great
deal, but that outcome is ultimately up to the bank.
Below are some standard short sale trials that both sellers and buyers should
be aware of before getting their hopes up:
- Sellers need to prove hardship. As a seller, you should
talk with your bank and then gather all of the documents they require to put
together a hardship portfolio to apply for a short sale. These usually include
tax returns, employment status and other personal and financial information. Be quick about it, because the bank has the final say, and you don’t want to leave them hanging. - Everyone needs to get used to the waiting game. This is
probably the most frustrating part, so don’t plan your life around a bank’s
approval. They could take anywhere from a couple days to a couple years to make a decision. - Banks are waiting on banks. Not only are you waiting on the
bank that has the mortgage, but there could also be other liens taken out
against the short sale. Those third parties also have to sign off on the debt. - Buyers should get a thorough home inspection. If you’re considering buying a short sale property, make sure you hire a professional home
inspector. - The home could go into foreclosure. Sometimes short sales take so long that the owners cannot keep paying their mortgage and the home goes
into foreclosure. Then the bank takes it over and starts a new waiting game.
Keep in mind there is no clear path for a short sale. Be ready and
patient!
Find out what's happening in North Forkwith free, real-time updates from Patch.
If you’re considering buying or selling short sales, you’ll want to enlist professional help to navigate the tricky waters. We can help. Please call us for more information.
-Kristen Rishe, North Fork Real Estate, Inc.