LIFamilies.com - Long Island, NY


RSS
Articles Business Directory Blog Real Estate Community Forum Shop My Family Contests

Log In Chat Index Search Rules Lingo Create Account

Quick navigation:   

Would you buy a short sale?

Posted By Message

TheDivineMrsM
2 girls 4 me!

Member since 8/08

7878 total posts

Name:
Mama mama mama....

Would you buy a short sale?

Would you consider buying a short sale or forclosure? Why or why not?

Posted 7/31/11 10:32 AM
 
Prudential Douglas Elliman Real Estate
Long Island's Largest Bridal Resource
  |   Long Island Weddings

fdnywife
Mommy of 3 and 4 rescues

Member since 9/09

1841 total posts

Name:

Re: Would you buy a short sale?

I considered it however every real estate agent I spoke to AND everything I read pretty much says... dont LOL

You have to be extremely patient, and even after you put in your bid the bank can turn around months later and say no.

I cant handle that kind of stress, but if you can you could save LOTS of money.

Posted 7/31/11 11:11 AM
 

mrsboss
my little love

Member since 12/09

5054 total posts

Name:
Me

Re: Would you buy a short sale?

Yes. We bought a short sale. It was a several month process, but very worth it in the end

Posted 7/31/11 11:21 AM
 

allIwant
Love my crazy life!

Member since 1/10

9170 total posts

Name:

Re: Would you buy a short sale?

If you have the time I would def do a short sale but knowing it could be a very long process

Posted 7/31/11 12:15 PM
 

muffaboo
LIF Adult

Member since 12/10

3797 total posts

Name:

Re: Would you buy a short sale?

If you're not in a rush to buy then I think it's a great option.

Posted 7/31/11 2:00 PM
 

Christine Braun - Signature Premier Properties
LIFamilies Business

Member since 2/11

3992 total posts

Name:

Re: Would you buy a short sale?

I think the key to buying a short sale is understanding the process, so your expectations are in line. The main thing you have to lose is time. It does take longer to get short sale approved, as you are waiting on the bank (and really, the underlying investor) to give the ok.

How fast the process goes really depends on the bank (or banks, if there is more than one mortgage involved), how cooperative the sellers are being (they need to provide a lot of information to the bank, and in some situations -- e.g., divorce - the sellers may not all be on board with doing the short sale), and how knowledgeable the listing agent is about short sales. Also, having a good real estate attorney who is familiar with short sales can help, and make sure your interests are protected as much as possible.

I think short sales work best for a buyer who doesn't have a specific timeline for getting into a house, given the potential for delay. However, a good attorney can draft the contract such that there are time parameters on how long you need to wait for a bank's response (e.g., if the bank doesn't respond within 4 months, you can walk away from the deal). You need not be in limbo, waiting for a response, for 9 or 10 months. Many attorneys have fee arrangements where you only have to pay them if you actually close a deal, so you are not paying out of pocket if the short sale doesn't go through. But that is something to discuss upfront with whichever attorney you decide to use.

Short sales can be great deals, but nowadays, many banks are being tougher about approving short sales. They also want to recoup as much money as possible and will make sure they are getting what they consider fair market value for the house. So short sales aren't always a steal. However, banks still like to avoid foreclosures, which involve a whole host of other costs/fees, so short sales are still the better option for them.

I have some experience with short sales, so if you have questions, feel free to FM me.

REO properties that have been foreclosed upon already are a different animal. They are often abandoned/neglected properties that need a lot of work (and probably won't qualify for a regular mortgage - you would need to get a 203(k) rehab loan). I have never sold an REO property myself, but I've heard from colleagues that they can be hard for the average buyer to buy. Banks tend to sell them in "blocks" to investors/builders. Certain agents tend to handle them and have a network of buyers that will buy multiple properties. It is more advantageous for the bank to sell them this way, in blocks. But you CAN get a very good deal on an REO property, if you are willing and able to do MAJOR renovations.

Posted 7/31/11 5:25 PM
 

smdl
I love Gary too..on a plate!

Member since 5/06

32461 total posts

Name:
me

Re: Would you buy a short sale?

Yes, and we were very interested in one but it got snatched before we could get any info.

Posted 7/31/11 6:36 PM
 

bunny1099
LIF Infant

Member since 7/10

366 total posts

Name:
P

Re: Would you buy a short sale?

We bought a short sale, and I know many people have tough times with it or it takes along time, ours only took 2 months and we were in!

Posted 7/31/11 8:36 PM
 

Mrs213
????????

Member since 2/09

18986 total posts

Name:

Re: Would you buy a short sale?

My friend is having such a hard time buying a short sale. There is no co for the pool, they have been dealing with this 9 months now since their offer was accepted Chat Icon

Posted 7/31/11 9:13 PM
 

JDandMe
LIF Adult

Member since 9/10

996 total posts

Name:

Re: Would you buy a short sale?

We bought a short sale and it moved pretty quickly considering we were "warned."

We put an offer in late March, received a counter from the bank in April, and we agreed. The apprasial came back low and we thought the bank would renegotiate but they accepted the apprasial amount and we when to closing.

We closed June 1st.

Posted 8/1/11 11:17 AM
 

EclecticEsq10810
Bored Esq.

Member since 10/10

2156 total posts

Name:
L.

Re: Would you buy a short sale?

This is a great thread, thanks for the advice, Christine..

I have a quick question,maybe you or someone can answer this since I don't do Real Estate and have a property I am STRONGLY considering doing a short sale on...

Does the bank care about how much the short sale is for, re: the gap between the appraisal value and remaining mortgage balance?

Message edited 8/2/2011 4:10:48 PM.

Posted 8/1/11 11:55 AM
 

JessInCA
live laugh love

Member since 8/06

5082 total posts

Name:
Jess

Re: Would you buy a short sale?

For a short sale, yes - as long as I had a living situation where I wasn't in a rush to move & could stay there as long as it took to get a decision from the bank.

A foreclosure, maybe - I'd definitely need a very good, trustworthy person to do the home inspection, because those are sold as-is, and I'd hate to be surprised with major repairs or problems after I'd bought it.

Posted 8/1/11 1:17 PM
 

JDubs
different, not less

Member since 7/09

13160 total posts

Name:

Re: Would you buy a short sale?

like PP said, if you are not in a rush and are patient then it is worth it. A friend of mine bought a condo that was a short sale but she waited over a year to close! But, she was in no rush because she was still living with her parents at the time.

Posted 8/1/11 1:46 PM
 

Christine Braun - Signature Premier Properties
LIFamilies Business

Member since 2/11

3992 total posts

Name:

Re: Would you buy a short sale?

EclecticEsq10810 --

I think the smaller the loss that the bank, and the underlying investor, has to take, the easier it is to get them to agree. They are losing less money that way.

BUT - The thing is, not eveyone can qualify for a short sale, even if the property is worth less than what is owed on the mortgage. The seller has to show that they have some hardship that makes it impossible to stay in the home... basically a financial hardship, making it impossible for them to afford the home. The biggies are death, divorce, and job loss, but there are other circumstances that can apply. In these scenarios, the owner is heading for a foreclosure situation if they don't sell, so the bank sees an advantage to allowing the short sale. A seller who is trying to get a short sale approved needs to submit a lot of paperwork about their finances -- bank statements, tax returns, household expenses -- and prepare a hardship letter, explaining why they NEED the short sale.

So not everyone can get a short sale, even if they are upside down on their mortgage. If you have cash to bring to the table, the bank would require that. I've also heard of banks allowing a short sale, but NOT releasing the seller from the debt. So that they seller carries the unpaid balance of the mortgage forward as an unsecured debt and has to keep paying it off.

It is hard to talk generally about short sales, because so much is depending on the bank, the individual circumstances of the seller, etc. But if you want to get into more specifics, please feel free to call or email me anytime!

Posted 8/1/11 2:10 PM
 

mrsgafforio
LIF Adult

Member since 3/07

3929 total posts

Name:
Christine

Re: Would you buy a short sale?

We put an offer on a short sale about 4 months ago and the bank JUST accepted. I'm hoping everything works out as houses in this neighborhood are selling for over 100k more than what we are paying, in the same condition.

Message edited 8/1/2011 2:53:56 PM.

Posted 8/1/11 2:51 PM
 

peanutbutter2
Carpe diem!

Member since 11/10

5287 total posts

Name:

Re: Would you buy a short sale?

We bought a foreclosure. We put the offer in and it was accepted a few weeks later. There was a lot of back and forth with the bank, but the house was ours about 3 months after we put the offer in.

I'm very, very happy with it. We've upgraded so much and fixed a lot up, so we've already added a lot of value to it.

Posted 8/1/11 10:28 PM
 
 

Potentially Related Topics:

Topic Posted By Started Replies Forum
Anyone buy a short sale and close already?? I need help and Im freaking out!!!! snowflake08 12/11/09 5 Home
Anyone buy a short sale? Did you call someone often? How did you move the process along? happytobreathe 2/27/10 0 Home
Toys R Us - Huge Buy 2 Get 1 Free Sale EmmaNick 9/23/07 11 Parenting
Another Police Pre-Sale Ticket for Best Buy Reward members nrthshgrl 2/21/07 1 Families Helping Families ™
Anyone Buy an Estate Sale? ~Colleen~ 3/3/06 7 Home
I guess some people really will buy just about anything on sale HarleyGirlFLA 8/29/05 3 Families Helping Families ™
 
Quick navigation:   
Currently 729174 users on the LIFamilies.com Chat
New Businesses
1 More Rep
Carleton Hall of East Islip
J&A Building Services
LaraMae Health Coaching
Sonic Wellness
Julbaby Photography LLC
Ideal Uniforms
Teresa Geraghty Photography
Camelot Dream Homes
Long Island Wedding Boutique
MB Febus- Rodan & Fields
Camp Harbor
Market America-Shop.com
ACM Basement Waterproofing
Travel Tom

      Follow LIWeddings on Facebook

      Follow LIFamilies on Twitter
Long Island Bridal Shows