Cold Hard Facts About Short Sales
When I set out to write this blog post, I was on a mission to inform myself, and others of what a “Short Sale” really is. If you’re like me, you may not have had the facts when it comes to understanding short sales, and so I have interviewed an expert and brought to you FOUR Cold Hard Facts about Short Sales! (plus some extra)
Lynn d’ Lindsey is known around the area for having extensive experience and the most trusted advice when it comes to Short Sales, and when I spoke with her, she was happy to shed some light on the things that clients truly need to know about these special Real Estate circumstances! So here’s the skinny…
- The name “Short Sale” can be misleading, but thinking they take a LONNNGG time is also a MYTH! Lynn says “Each short sale is unique, and no one is like the other, it all really depends on the type of loan that is underlying the short sale. For example; if you have an FHA loan you might expect 6-8 months, but if you’re dealing with a KY Housing Loan, it has to be approved from the get go, so you could close in 1 day, or 1 week!” A Short Sale with Lynn averages 45 days long.
So why IS it called a “Short Sale”, well, this comes from the lender agreeing to a homeowners sale of the home, while the price is less than what they still owe on it. The sellers are short the remaining balance.
2. ALWAYS ALWAYS ALWAYS, hire an expert! Short sales are unlike a typical real estate transaction, it’s in the best interest of the client, to find an agent with experience, who is knowledgeable about relocation assistance and applying for different financial programs that offer money for those who qualify for an allotted amount, otherwise a client could be leaving thousands of dollars at the table that could be theirs! Lynn says “most short sale banks will offer credits to homeowners, and if the agent you hire doesn’t know about these programs, it can have long-term effects on a client’s financial state. An experienced agent knows what banks are looking for, what documentation is necessary, and how to present the best application possible. If details like these aren’t handled as quickly and efficiently as possible, the client could be facing an avoidable foreclosure!”
An expert in short sales will also be able to inform you about why it is preferable to file bankruptcy when doing a short sale, if necessary, instead of facing foreclosure. The short sale only stays on record for 2 years and the foreclosure will follow you around for much much longer and effect your finances in the future! *A short sale will blow up when the expectations start falling apart, the right agent will be able to best prepare the client for the process and help walk them through each step!
Foreclosure = no control on pricing the home. Short Sale = you get to decide how much to sell for, with agreement from the bank.
3. Short Sale DOESN’T MEAN DINGY! As in any real estate transaction, homes that are taken care of, SELL! This is no exception with short sales, so remember, keep up with the place, and present it at it’s best, to attract more buyers and get the best price possible!
4. What about the buyers?
So you want to buy a short sale? Did you know that all short sales are different? There is no set outline of expectations. Some close in day, some in a year, but patience on the buyer’s side ALWAYS pays off! Lynn tells me “The average short sale, sells for 10% below market value, and if you’re purchasing a short sale home it can somewhat be like using layaway! It could potentially take a long time, but the reward in the end is a PRIZE! Plus you typically gain equity while you wait!”
Thanks again Lynn d’ Lindsey for all of your time and insights you had for us to put out there!
If you want to check Lynn out click here→ Lynn d’ Lindsey