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In today’s market, those investors who be able to successfully buy short sale houses stand to make a lot of cash. Investors familiar with short sales know the benefit of being able to buy a property at fire sale prices. If you are new to purchasing short sales of preforeclosures, please understand that while the process may seem complex, the return on investment be able to be fantastic.

With this in mind, how does one go about purchasing a short sale property? To get started, you must appreciate that a short sell is just purchasing a property for less than the mortgage value. Obviously, there will be parties that benefit from a short sale and those that will actually lose money. However, you will be dealing with a bank that is trying to minimize their loss so there will be a lot of paperwork that will need to be completed. Because of this, a huge deal of patience is needed through the purchasing process

While going through the short sale process, you must be aware of how each participant will act through the process Obviously the property owner is a big factor in the transaction and may be going through some financial turmoil which is leading to the need for a short sale. As the initial part of the due diligence process, be sure that the property owner is willing to go through the short sale process.

Be sure that you get the property owners approval, but you will need to contact the loss mitigation department of the lender in order to start the process. Because the bank is in business to make capital, you will need to make a compelling case in order for them to agree to a short sale. The majority lenders will only agree to short sales if the property is facing foreclosure or non-payment of the loan. With that in mind, the onus is on you to demonstrate that the deal is in the institution’s best interest.

The short sale process now is just a matter of crafting a purchase offer to the institution that includes reasons why it is in their best interest to do the deal. Locate any and all areas of disrepair on the property and take pictures of them, and get an appraiser to come out and give an appraisal based upon the lowest marketable value of the home.

Combine all of these documents together as well as any additional documents required by the loss mitigation officer of the institution to create your short sale package. Present your purchase request along with the short sale package to the bank and gently push it through the approval process. It the offer is approved, your purchase of the short sale goes through. If not, just modify your request and submit it again.

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