Buying Short Sale Listings
Purchasing a short sale is not something which anyone should attempt without an expert short sale buyer's agent who is also, a short sale listing agent. The truth is, only a listing agent can be a good buyer's agent when it comes to short sales. There are just too many things that you'll need to just know... without asking. And if your real estate agent only works with buyer, he or she will never really understand what's going on with the seller's side of a short sale transaction.
What is a short sale?
A short sale listing in Charlotte (or anywhere) is simply a home for sale at a price that’s less than the total payoff of the mortgage. The short sale listing agent in Charlotte must try to negotiate with the bank and get them to take less than what is owed. That negotiation is why short sales take longer than regular sales or foreclosures. back to top
Can just any Realtor help me buy a short sale?
Absolutely not. In fact, MOST Realtors who claim to be short sale specialists have absolutely no idea how to make them work successfully. Short sales can be an amazing opportunity but you have to have a Short Sale Buyer Specialist who also understands the listing side. One of the most important aspects of any short sale listing is the experience and competency of the short sale listing agent. Only a short sale buyer specialist, who knows what to look for, will be able to help you judge this factor. Get it wrong, and the offer you make may never close.back to top
Are short sales a really good deal?
Sometimes; it depends on a lot of factors. Mortgage banks have the final word when it comes to short sale sales prices. They decide how good of a deal you will get and that is often determined by independent valuations done by real estate agents and appraisers who have nothing to do with the transaction at hand. If those valuations, also known as BPO’s or Broker Price Opinions, come in correctly then you will get a pretty good deal – usually 5-10% off of market value. If they come in low, you can save as much as 25-50% but if they come in too high, you can actually overpay! Make sure that your short sale buyer agent knows the difference and that you get the best deal possible. After all, that’s what you’re waiting for anyway, right?back to top
How negotiable are short sale prices?
A very important thing to remember when it comes to short sale negotiability is the fact that the bank (who is making the final decision) DID NOT SET THE LISTING PRICE. In most short sales, the listing price is a “best guess” which is made by the listing agent. Very often, the short sale listing agent sets the price way too high or too low.
When the bank makes their decision, they can allow a price which is much lower than list price and they can even ask for a price which is much higher. This is because they did not set the list price, and they do not consider the list price when making their short sale decision.
Furthermore, the short sale bank does not “negotiate” in the traditional sense. They will run the numbers relating to the property through their computer. They will NOT consider the list price and they will NOT consider your offer price. The computer spits back a number and that is what they will accept. If your offer is higher than that number, they accept your offer. If it is lower, they tell you what they WILL accept.
So, if they counter offer at a price 10k higher than your short sale offer, wouldn’t you like to try to “negotiate” with them, maybe meet them half way and save a little more? Unfortuately,it just doesn’t work that way - there is no traditional "ahggling" with a short sale lender. Their counter offer is their final offer, take it or leave it...
That is... unless the listing agent is experienced enough to understand the system from the inside out. There are ways to get around this barrier but 99.9% of normal short sale real estate agents do not know how. That’s why it’s good to know what the bank is going to say, before they say it. A good short sale buyer agent can tell you that and will potentially save you 6-8 weeks of wasted time on a short sale property that you were never going to be able to buy in the first place.back to top
How long does it take to buy a short sale?
From the day you submit your offer, to the day of closing can range from 60 days, to 120 days or more. We would always advise you as to the expected wait time and would recommend against making offers on those properties which will take longer than 90 days to close. Usually, those which do not close in 90 days take so long because the listing agent makes several mistakes along the way, or simply doesn’t understand every little thing the bank is going to require. Sometimes the bank makes the mistake and the listing agent simply didn’t catch the error. Each forgotten document or tiny clerical error can cost you an extra week of time. And with so many possible errors, those weeks can add up fast. It all goes back to choosing the right short sale home for sale in the first place.back to top
How do I find short sales?
Ask us! We have more experience with short sales than most Realtors in the country and all of that comes from working right here, in Charlotte and we’ve been doing it for much longer than anyone else. You can search for short sales here, or Contact us with a specific request. We’d be happy to make your short sale dreams, a reality.back to top