Get the Latest Short Sales in Maricopa
Many prospective real estate buyers and sellers are unsure about the different pros and cons of the often elusive short sale.
There are 4 types of real estate transactions in the state of Arizona that make up 98% of all transactions. They are short sales, foreclosures, resales and new build/spec homes.
For a buyer that is not familiar with the terminology, short sales sound like a great place to start because they can buy the home in a “short” period of time right? Actually no, short sales generally take longer to buy than a regular resale, foreclosure or a spec home!
Short sales are “short” because the home is worth less than the amount owed on the mortgage. For example, let’s say a seller owes $250,000 on a home, but the market dictates that the home is only worth $200,000 then the seller asks the bank for permission to sell the home for $200,000 (market price) and the seller asks the bank to forgive the remaining $50,000 debt. Short sale = short money, not short time.
There are far fewer homes needing to be short sold today verses a few years ago partly because of real estate prices increasing in the past few years, therefore less homeowners are upside down. Homeowners that purchased their home at the height of the market may need to short sell, but many that bought before and after the bubble may be ok to have a regular sale.
Short selling a home is designed to aid owners with financial hardships, whether it may be loss of a job, medical reasons, job transfer, decrease in work hours or a myriad of other issues that are legitimate reasons to short sell. Deciding to short sale a home? There are specific questions you want to ask. Home owner associations and a property with multiple loans on it need specific consideration. A short sale can take as little as a month, or as long as several years. Not all real estate agents are created equal. You need to look toward a short sale specialist.
Considering purchasing a short sale? There are a few tricks of the trade that I pass on to my clients. A buyer that is on a specific time frame (moving to the area, has a home to sell also, list price nearing buyers maximum criteria) should stay away from short sales. Believe it or not, with a short sale, a buyer can offer OVER asking price and the bank can still say no. In a short sale, price is set by the listing agent, and is generally an educated guess at what the agent thinks the bank will accept. Still interested in a short sale? I also have experience getting MY client’s offer accepted when there is a multiple offer scenario.
I understand this is quite a bit of information. Whether you are buying a short sale or considering short selling your home, make sure you contact a short sale specialist!