What you Need to do Before Buying a Short Sale

Buyers pursue short sales for two primary reasons: firstly, they genuinely like the house and secondly, to get a good deal. The biggest drawback to this type of transaction is the time it takes to close – the term “short sale” is a bit misleading in this regard. But if you’ve got a flexible timeline, this could be a great purchase for you.

A successful short sale means the seller’s lender is willing to accept a discounted payoff to release an existing mortgage. As a potential buyer, it’s important to understand that just because a property is listed with short sale terms does not mean the lender will accept your offer, even if the seller accepts it. That’s because sellers need to qualify for a short sale.

The first thing you’ll want to do is find yourself an agent with short sale experience. He or she will help to expedite your transaction and protect your interests.

The second thing you want to do is check public records. It’s important to do your research before making an offer to purchase a short sale. Your agent can find out who is in title, whether a foreclosure notice has been filed, and how much is owed to the lender. This is important because it will help you to determine how much to offer.

In the short sale scenario – and really this goes for any type of housing you wish to purchase – you’ll definitely want to have your finances in order and get preapproved for a mortgage. Don’t be surprised if the lender asks for a copy of your earnest money deposit, proof of funds, and mortgage preapproval letter.

After you’ve found the perfect property and submitted your documentation and offer, you’ll just have to hurry up and wait. Depending on the situation, some buyers wait six weeks to six months to close on a short sale, but if you’re willing to wait it out the payoff could be great.

If you’re interested in checking out short sales available in the Mile High City, contact Metrowest. We specialize in these types of sales and would love to help you start the process!

Ken Blevins

About Ken Blevins

Ken Blevins, CEO of Metrowest Real Estate Services, is a veteran in mortgage and default servicing with more than 24 years of experience in collections, foreclosure/bankruptcy, loss mitigation and real estate disposition (REO). Blevins was an original co-founder of Metrowest in 2003, a Real Estate Brokerage and Services Company focused on the resale, recovery and liquidation of distressed real estate in Denver, Colorado and surrounding metros. Blevins assumed the role of CEO in January 2014 and provides strategic direction and has management accountability for the day-to-day operations. Under his direction, Blevins drives all default management operations to maximize asset value recovery and reduce loss severity through a strategy focused on customer service and state of the art technology. Blevins has 18 years of direct operational experience in all facets of REO Asset Management having managed large national REO Disposition contracts for Fannie Mae, Freddie Mac, Wells Fargo, JP Morgan Chase, CitiFinancial, GMAC Mortgage and other various financial institutions. Blevins specialties include REO asset management, real estate investment, bulk REO acquisitions and distressed asset recovery and liquidation, and he has directed the resolution and liquidation of over ten billion in institutionally-owned residential real estate.
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