Buying a Short Sale

When you are searching for your new home you will undoubtably come across a number of homes listed as short sale, don't be afraid, if you have time to wait a short sale can be a very good choice. This is a home that the owners are still living in so it usually has not been allowed to fall into major disrepair. Short sales take time. As the buyer you submit your offer through a real estate agent just as if it were any other listing. The offer goes to both attorneys for attorney review as any other sale. Once you finish the attorney review period the seller's attorney sends the offer to the bank and the buyer starts the waiting period. This wait can be anywhere from a few weeks to a few months, the bank will send out agents to make inspections and come up with the "fair market value" of the home and review the seller's information to re-evaluate the need for a short sale. All this time the buyer can do nothing but wait, many get impatient and walk away from the deal but if you really want the house hanging in there is your best option, nobody is trying to put one over on you, it is just a long process. Once the bank receives all the information they need they may accept the offer, counter with a different sales price or refuse the offer. The counter is not necessarily their lowest number so feel free to have your negoitiater (either your attorney or your agent) come back with your counter. Banks to not usually counter again so make sure that this is your highest and best price and be aware that the bank has a bottom line already and nothing you do will make them change it. Your attorney and your real estate agent can advise you on the counter you plan to make but the final offer price is your decision.

After your offer is accepted thing are expected to move very quickly, the buyer is usually responsible for the scheduling and expense of all city inspections (CO or Dwelling certificate) and you can do a home inspection. The bank will not make any repairs on a short sale so your home inspection if for your information only. I strongly suggest that you do an inspection because, in the case of hidden defects, you can ask for the repair to be paid or you can cancel the sale if it is something you don't want to pay for yourself.