How to Buy a Short Sale

Over the past few years the real estate market has seen a multitude of properties selling as a short sale. While many markets are finally seeing a reduction in these distressed properties, they are still around and affect the homeowner as well as the potential buyers.

Simply stated, a short sale means that the lien holder on a property accepts payment that is less than is owed….in other words, it’s “short.” The lien holder would be the lender or lenders. If home has a first and second loan, then both lenders (lien holders) would have to accept the terms.

The process is relatively simple:

• The listing agent notifies the lien holder(s) of the intention to sell as a short sale

• A buyer’s offer is accepted by the seller

• The seller completes a full short sale package and submits to the lien holder(s)

o Buyer’s offer

o Seller statements of financial distress/hardship

o Seller’s complete financial statements

• The lien holder(s) order a Broker Price Opinion (BPO) which is an approved real estate broker’s opinion of the market value of the property.

• Once approved by current lien holders, then the sale concludes as normal. (Buyer obtains loan, appraisal, inspections, etc.).

Buying or selling a short sale property takes a little longer, but there are benefits and it is a far less difficult than it used to be and if the property is right, nothing to run from.

If you have any questions please give me a call! Remember..

...For anything Real Estate, Call Kate!

Kate Montrony

Licensed Sales Agent

(631) 960-8881