Short sales for dummies

Best Agent for a Short Sale Because of the complexity of the transaction, a buyer should work with an agent or realtor who is experienced with short sales and willing to work on one. Here is where the delays and negotiations take place.

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The hope is that, if the home sells, the lender will recoup the majority of what the homeowner owes. Sometimes, this gives buyers more time to close the loan.

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What are the reasons the mortgage lender would reject an offer? It is therefore recommended that buyers work with a reputable and flexible lender and secure pre-approval for financing by the time an offer is submitted.

This can take several weeks to months.

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A short sale can only happen when all lien holders on the property agree to the short sale. For example, the buyer covers the cost for inspections and repairs.

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Homeowners who undergo foreclosure experience an immediate drop and precipitous drop in their credit ratings. If a lender believes a better price can be obtained by taking the property in foreclosure over a short-sale offer, the lender may hold out for a higher price. Most people would consider this unethical because the potential purchaser is likely to have shelled out a few thousand dollars on inspections, title searches and the like, at this point. A short sale can only happen when all lien holders on the property agree to the short sale. Then, if the offer is accepted, the lender can ask for the loan to close quickly, typically in a couple of weeks. Pest inspections or work necessary to issue a clear pest report. Both the seller and the buyer need to make sure the sale makes sense for everyone, not just the seller. Lenders Discount Commission: Lenders who have sold loans to Fannie Mae or Freddie Mac generally pay traditional real estate commissions to real estate agents. Why do homeowners sell their homes through a short sale? The most common reason is simply that the offer price is too low. Further, the listing price of a short sale may be an amount the seller's agent thinks the bank might accept, rather than the amount the bank has actually agreed to accept. In the worst-case scenario, they might not reply at all. The transaction benefits the bank by allowing it to avoid repossessing the home in foreclosure , which is expensive and time-consuming.
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Buying a Short Sale Property