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Health & Fitness

Tips for Buying a Short Sale Property

Buying a Short Sale Property isn't the same as a traditional seller. Here are some tips to help prepare you for what may be coming. 

TIP 1

You are not buying on your schedule. If you need to move out on a specific date or have a personal idea of when you will be in your new home, this might not be for you. There are a lot of negotiation with short sales, because it’s ultimately up to the bank when you will close. Make sure when you are set to move out, that you have a plan B and know where you will be staying if something is postponed.

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TIP 2

You are writing an offer to a bank not a traditional seller. That means you need to be pre-approved and ready to buy. Banks are not going to take you seriously unless you are serious about buying. Make sure that your loan officer has everything completed. A pre-qualification is a basic understanding of what you might be able to qualify for. They might not even review your offer unless you are pre-approved.

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TIP 3

You put your highest and best price down on your offer, the bank accepts it, and now you move to your inspections and/or appraisals. All home loans will need an appraisal on the property to makes sure the value of the home is what you are offering. If the home did not appraise for the amount you offered, a loan officer most likely won’t approve the loan. Since you no longer have approved financing, you will have to withdraw your offer and move on to another property.  In this scenario your agent will do a comparative market analysis to see what your best offer will be without going over the market comparables. This way you are not wasting time and money if you already paid for a home inspection.

TIP 4

Everything with your end is now approved. Appraisal went through, inspections are done, everything is peachy on your end. However, the bank that owns the short sale property will be doing their own appraisal. If the property appraises higher than what you are offering, they will counter and ask for a higher price. A knowledgeable real estate agent will be able to lay out all your options for you, making sure that you understand each one and support you as you decide what is best for you.

TIP 5

Prepare to wait. Banks will be waiting to approve the offer until it is completely ready to close. Nothing is final, until you sign the papers at closing and you are handed the keys. This waiting period could last up to 120 days.


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