What buyers should know about short sales (COLDWELL BANKER)
With more lenders accepting short sales as a way to avoid a drawn-out foreclosure
process and reduce costs, buyers looking at short-sale homes should learn what to
look for in a property, Market Watch reported.
Those selling a home can benefit significantly, since it allows them to make a
sale rather than going through foreclosure and is significantly less damaging to
their credit score. Buyers may be attracted because bids as low as 10 percent
under market value may actually be accepted, according to Travis Hamel Olsen, a
real estate expert.
Things to consider about a short sale
Despite their potential advantages, short sales may have a downside. One real
estate expert told MarketWatch that short sales can be time-consuming, with
buyers commonly waiting two months to hear whether their offer is accepted or
receive a counter-offer. During this period, buyers may not hear anything, and
complications in the seller’s finances may slow the process further.
Experts also pointed out that short sales are commonly made as-is, and generally
won’t include any credit towards repairs. As a result, properties should be
inspected to ensure that the buyer knows of any problems likely to incur future
Buyers should be cautious, experts noted, about bidding too low and rely on their
real estate agent to help them determine the best offer to make. Banks may want
to sell, but they won’t accept too poor a deal, so bids should still be
reasonable for the market conditions.
Factors to keep in mind
Other analysts told MarketWatch that bank-owned properties may be priced even
lower than short sales, but may be in worse condition, particularly after an
extended period of vacancy. Buyers should carefully compare repair costs and
current condition of properties as well as the price.
Considering the amount of time a short sale takes and the uncertainty that a deal
will be finalized, Olsen recommended that prospective buyers who have made an
initial offer keep looking for homes and consider alternatives, in case they are
rejected or find a better option.
About Coldwell Banker®
Since 1906, the Coldwell Banker® organization has been a premier provider of full-service residential and commercial real estate. Coldwell Banker is the oldest national real estate brand in the United States and today with approximately 3,100 offices in 50 countries and territories. The Coldwell Banker brand is known for creating innovative consumer services as recently seen by being the first national real estate brand to create an iPad application and the first to fully harness the power of video in real estate listings, news and information through its Coldwell Banker On LocationSM YouTube channel. The Coldwell Banker system is a leader in specialty markets such as resort, new homes and luxury properties through its Coldwell Banker Previews International® marketing program. Coldwell Banker Real Estate LLC fully supports the principles of the Fair Housing Act and the Equal Opportunity Act.