Jerry Guy Buyers Agent Blog

Short sale of a house refers to a sale wherein the sale price is less than the balance of the property's mortgage.

This usually happens when the homeowner has not been able to keep up with his mortgage payments.

The lender will sometimes even take a small loss on the property rather than force it into foreclosure. For example, let's say a homeowner can no longer make his payments on a $150,000 mortgage. Both the homeowner and the lender may reach an agreement and be willing to put the house on the market for less than the $150,000 value of the mortgage.

Now the house is up for short sale. Foreclosure proceedings usually take more time than putting a house on the market as a short sale.

However, it is more complicated than a regular sale.

Short sales may require numerous approvals. Debts to a homeowner's association or a second mortgage are sometimes found with short sales. Agreement of still more creditors, such as tax assessors must be reached before a property can be listed on a short sale basis.

The short sale is one of the more complex real estate transactions because it involves so many creditors, and because there are special procedures and processes that must also be completed.

Foreclosure sometimes interrupts the negotiations on short sale houses, which is one reason why short sales are subject to failure. Because both the lender(s) and the borrower are constantly in negotiation, a house that is up for short sale one day may not be available for purchase the next day. The causes of removal of a short sale property from the market can be a result of the homeowner deciding to either move out and allow foreclosure. Sometimes it is the lender who either wants to try to work with the owner, or who decides to opt for foreclosure. As a perspective buyer of a short sale property, you will find that the process is in some ways similar to buying a foreclosed home.

Homes on the market as short sales therefore take a longer time to come to completion, and encounter more delays along the way, than their 'standard' counterparts. For this reason, among others, you should pay a price that is below market value when buying a short sale property. As with the purchase of any real estate property, you will want to do many things before you sign on the dotted line. Getting your funding together first is critical. You will want to get the property inspected.

Any second- or third-tier creditor can show up at any time with a short sale, so double check. Finding out how much the current owner paid for the property, and the value of similar homes in the neighborhood, is a good idea.

It is not advisable to try to take on all of this yourself if you are considering buying a short sale property. You will be best served to find a real estate agency that specializes in short sales. A well-qualified agency will have a buyer's agent available to assist you. The buyer's agent's experience will provide you with everything you need to complete the purchase. Jerry Guy is a licensed Realtor who specializes in helping his clients find residences throughout the region, including the Brandon, Florida real estate and Tampa real estate markets. He has extensive knowledge of a range of properties including the highly-specialized categories of foreclosure, REO, Waterfront and Luxury Home properties. Whether you are undergoing military relocation or searching for homes in the Tampa Bay Area for sale to accommodate you and your family, our services can prove invaluable to your success. For more information, please visit Jerry's website at www.JerryGuyBuyersAgent.com.

When the sale price of a house is lower than the amount due on a mortgage, that property is said to be up for short sale.

Short sales usually happen when a homeowner has been unable to keep current with his mortgage payments.

Opting to put a property on the market for short sale is often an option that the lender will consider. Let us say, for instance, that a homeowner has a $150,000 on a home and can no longer make his payments. Both the homeowner and the lender may reach an agreement and be willing to put the house on the market for less than the $150,000 value of the mortgage.

Now, the home may be put on the market as a short sale. Short-selling typically takes less time and is less expensive than foreclosure proceedings.

However, it is more complicated than a regular sale.

Short sales often require multiple level of approvals. Dues in arrears to a homeowner's association or a second mortgage are other debts that may be involved. Back taxes may be owed, and these additional creditors may also need to approve the sale in order for the property to be put on the market.

Because many processes and procedures must be satisfied, even after all the creditors are online, the short sale is a relatively complex real estate transaction.

Short sales are subject to failure more often than other types of sales because by the time all the creditors and requirements are satisfied enough time has elapsed that the property goes into foreclosure. You may even see that a property up for short sale one day may disappear from the market on the next because the lender and owner are no longer in agreement. The homeowner may cause the short sale to stop because he may decide to try to refinance or settle for just getting out of the whole thing via foreclosure. Sometimes it is the lender who either wants to try to work with the owner, or who decides to opt for foreclosure. There are complications with buying a short-sale property that are similar to those encountered when dealing with foreclosures.

Closing on a home that is up for short sale is a process that often encounters delays, and usually takes longer to complete than other real estate transactions. For this reason, among others, you should pay a price that is below market value when buying a short sale property. As with the purchase of any real estate property, you will want to do many things before you sign on the dotted line. Getting to contract quickly begins with your ability to quickly produce the necessary funding. It is just as important to have a short sale property inspected as it is to have any new home inspected.

You will need to check for any additional creditors, just to be sure. You will want to know what was paid for the property, and what similar homes in similar neighborhoods are selling for.

As you can see, buying a short sale property is very complex and it is not advised that you do so without help. You will be best served to find a real estate agency that specializes in short sales. It is also a good idea to request a buyer's agent for the transaction. His experience will help guarantee the success of your purchase. Jerry Guy is a licensed Realtor who specializes in helping his clients find residences throughout the region, including the Brandon, Florida real estate and Tampa real estate markets. He has extensive knowledge of a range of properties including the highly-specialized categories of foreclosure, REO, Waterfront and Luxury Home properties. Whether you are undergoing military relocation or searching for homes in the Tampa Bay Area for sale to accommodate you and your family, our services can prove invaluable to your success. For more information, please visit Jerry's website at www.JerryGuyBuyersAgent.com.