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If you're a buyer,
purchasing a short sale in Tampa Bay can mean a good deal, as long as you're aware of the extra time and work required to make it happen.
Buying a home in a short sale can be a hassle, so why should you consider it? Mainly, it boils down to the bottom line. You will
likely get the property for a substantial discount. Since the lender is eager to continue to get paid back the money it loaned out -- it may also offer favorable financing terms.
First understand that the
seller's lending bank will be the deciding factor whether or not your offer will be accepted. But also
understand that the owner has the right to reject your offer if they feel it is too low as well.
Do not waste your time with an offer if it is extremely lower than the short sale listing price. Even if the seller submits the offer for bank approval, the bank is under a legal obligation to obtain a fair market value for the price of the home, otherwise they can be held liable for the difference. Therefore, short sales are not a "get it for free" deal. But, in many cases, you can still negotiate an awesome deal for the property. Many banks will not even respond to your offer if the price is too low. They're
overwhelmed with offers on properties and generally don't bother responding if they feel the offer is not
realistic.
Since the seller is upside down on the loan, he or she can still be held responsible to the bank for the difference in the sale price and the unpaid amount on the original loan. An experienced Seller's agent will generally encourage the seller not entertain
"pennies on the dollar" offers.
You're a good candidate for a short-sale purchase if:
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You're very patient. Even after you come to agreement with the seller to buy a
short sale property, the seller’s lender (or lenders, if there is more than one mortgage) has to approve the sale before you can close. When there is only one mortgage,
a short sale typically takes about two months. If there is more than one mortgage with different lenders, it can take four months or longer for the lenders to approve the
contract and sale.
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Your financing is in order. Lenders
generally require proof of funds for cash offers, or a
pre-approval letter from a mortgage lender (on their letterhead)
for an offer with a financing contingency.
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You don’t have any
other contingencies. If you have a home to sell before you can close on the purchase of the
short sale property - or you need to be in your new home by a certain
time - a short sale may not be for you. Lenders generally
won't approve a contract that contains these types of
contingencies.
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