How to Buy a Short Sale

When you look at the local real estate market, it is easy to become overwhelmed with all of the choices you have, and, in some areas, how quickly those choices are being bought up by other buyers. New houses in Sierra Vista of every type hit the market daily: equity sales, bank-owned sales and short sales are all competing for your attention. If you are not in a tremendous hurry to purchase a home and want to capitalize on substantial discounts in pricing, then you should consider buying a short sale.

A short sale is when a house is being offered for sale at a price that will not fully payoff the mortgage(s) owed on it. This situation usually occurs when a homeowner bought the property at the height of the market–somewhere between 2005 and 2009– and now that the values have come back out of the stratosphere, the homeowner owes more than what they paid for the house. Since they do not have the ability to bring that difference to the closing table, they must get the permission from the banks who hold the mortgage(s) in order to sell. This process takes time.

The time is takes to sell New houses in Sierra Vistawhich are marketed as a short sale can vary anywhere from 90 days to a year, although the average time is generally five to six months. This may sound like a lot of time to wait– and it is– but what savvy buyers have done is figured out a way to capitalize on the situation. Working with a skilled real estate agent, buyers have realized that when an offer is written on a short sale, there is no requirement to put earnest money in escrow until the seller’s bank approves such an offer.

Unlike a traditional sale where a potential buyer writes an offer and gives an earnest money check to either the agent or title company to deposit, writing an offer on a short sale involves stating that the buyer will deposit earnest money within four days of the acceptance of their offer by the seller’s bank. What this translates to is that buyers are able to continue looking at new houses in Sierra Vista and to write additional offers on any other homes they see that fit their criteria, short sale or otherwise. As soon as a seller (or a bank, in the case of a short sale) accepts the offer, the buyer simply has his or her agent write up a cancellation addendum removing all of their other offers from consideration. In this way, you, as a buyer, do not get stuck writing one offer on one short sale home and waiting 6 months only to find out the home was sold to someone else.

Castle & Cooke commercial real estate supports their local economy & project such as The Mall at Sierra Vista, the Home Depot, & a variety of stores, & professional offices enhance the lives of the individuals & families living in new houses in our residential communities.

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