What is a short sale and are short sale homes a good value?
When a homeowner for one reason or another can’t make the monthly mortgage payments, the home is placed on the market as a short sale. A short sale is when the home, with the approval of the lender, is going to be sold for less than what is owed on the mortgage. Short sale homes are usually priced under the current assessment, and can be a great deal for a homebuyer. However, there is one huge downside: the timeframe at which it usually takes to close on a short sale home. A normal home sale usually takes 30-45 days before closing, however with a short sale, there are more parties involved, including the initial lender and a 3rd party negotiator for the bank. Because of the additional parties involved on the approval of the short sale and additional paperwork involved, the short sale can take months. Even after working on the deal for months, depending on how long the previous owner wasn’t paying the mortgage, the house can still go into foreclosure and end the deal. Short sales involve a lot of time and patience. If you’ve got plenty of both, then this might be the route for you. If not, it’s probably best to stick to traditional home sales.