Short sales are solution-rich: they provide a good deal for a buyer, they represent a successful negotiation with your lender, they free homeowners from the consequences of foreclosure, and they ultimately help your community at large as far as the value of the neighboring properties.
But first of all, anything this good can be subject to fraud and corrupt people attempting to profit from misfortune; so distressed homeowners need to beware of disreputable people who make promises that they will help them get out of debt, but only stand to make money themselves.
While keeping the disreputable at bay, you need also beware of buyers. While they are obviously the critical component in a successful short sale, they must offer qualifications beyond the financial. Short sales take time and patience and you’ll need assurance that your buyer is in for the ride. So besides the obvious confirmations of lender pre-approval or proof of funds if they are cash buyers, please consider:
- Is the buyer making a reasonable offer or will it cause a short sale package rejection?
- Does the buyer understand that this process can take from 1 to sometimes 6 months to be approved?
- Will the buyer agree to spend money on things like application and attorney fees and inspections?
- Can the buyer offer flexibility on the closing date?
If there are any doubts about your short sale buyer, you may want to pass; it will cause you heartache and a waste of time you do not have.
And finally, beware of misinformation. You really can’t believe everything you read nor should you take advice from the “guy down the block” about your short sale – every situation is different, a short sale is a negotiation. So whether you are buying a short sale property or selling a short sale property, enlisting the assistance of a responsible and experienced Realtor is your first and best step.