Are you considering a short sale? A short sale can be a great option to get more home for your money, but many buyers enter into the process without a thorough understanding of what to expect. At Henderson Properties, one of our goals is to help our buyers know exactly what to expect from the home buying process. Here are six things you should know about buying a short sale.
1. You Will Wait, and Wait, and Wait
In a short sale, the bank is likely going to lose money. This means they are not in a hurry to approve the sale. Because of this, after your offer is accepted by the seller, you will spend a long time waiting for rejection or acceptance from the lender. Don’t call your agent all the time asking for an update. Your agent will let you know the moment something changes. It can take up to a year to get final approval, so keep your eyes open for other homes.
2. Things Will Move Quickly (Once They Start Moving)
Short sales are riddled with uncertainty, but once the bank says “yes,” you may have to move and close quickly. Sometimes the bank is facing a deadline for foreclosure, and so your months of waiting will turn into a “yes” followed by a “you need to close tomorrow” type urgency.
3. You Will Need to Work on the House
Short sales are often in worse shape than homes sold for a profit, but better shape than foreclosures since the owner lives in the home until closing. Since the owner knows that he is going to have to move and won’t be getting any money from the sale, he likely stopped putting money into the house. Sometimes, he neglected basic maintenance. You will need to put some sweat into the property to get it where you want it.
4. See the Home’s Potential
With short sales, you must be able to see the home’s potential after your maintenance and upgrades. These homes often do not show like homes the seller is vested in selling. Be willing and able to see past clutter and maintenance issues to see the diamond in the rough.
5. Remember Resale Value
Your short sale may be a good bargain, but don’t forget about resale value. If you play your cards right, you can purchase a home that is almost instantly higher in value than it was the day you purchased it, simply because you are willing to put a little work into it.
6. No One Will Understand
If you are buying a short sale, your friends and family are not going to understand. They will wonder why you are still waiting to hear about your house. Be prepared to explain the process over and over again. Soon you will be as much of a short sale expert as your real estate agent!
If you are considering buying a short sale, Henderson Properties can help. Our real estate agents are skilled in navigating the short sale process, and are happy to help you understand what to expect along the way.