"SHORT SALE" PROPERTIES
A short sale is when the Seller is attempting to sell the property for less than what is currently owed to the bank (lenders). For these properties, offers are submitted to the lenders for approvals as they have the final say in what they will accept or if they will accept a partial payoff on the balance owed (to satisfy the mortgage).
Though these are a great opportunity to purchase a property for less, there are some requirements, timeframes, and concessions often associated with these transactions. Items that the seller usually pays for are generally at the buyers expense, like termite inspections, cleanings, and staking or survey of the property (for homes) and condo documents. Also, the processing time for these offers can take anywhere from 6 weeks to 6 months, though you as the buyer could cancel any time prior to full approvals by the lenders/bank.
If you decide to write an offer on this type of listing, the following will be REQUIRED for your offer to be considered.
* Pre-qualification letter: I can give you the names of lenders my clients have used and been very pleased with as well as their contact information. My previous client's favorite loan source has been Lisa Ledesma at Wells Fargo.
* Earnest Money: a personal check or wired funds to Escrow will be acceptable in most cases for your earnest money deposit
* Verification of Cash Funds: a copy of bank statements or letter from your financial institution on letterhead verifying your cash funds will be required when you submit an offer on a short sale.
If you have additional questions regarding Short Sales or would like to see available listings, please contact me directly.
Please bear in mind that more often than not, the asking prices are not pre-approved by the lien holders but are set low by the sellers and their agent to motivate buyers to write an offer with minimal time on the market for the property. The bank generally will order a BPO (Broker Price Opinion) or Appraisal upon receipt of an offer to determine the current market value of the property and respond accordingly. As such, it is possible that the bank's response could be higher than the asking price on the property. The best way to write an offer with the greatest liklihood of being accepted is to write your offer with a price based on a review of recent and comparable area sales.