Quick Helpful Hints in Purchasing Short Sale Home- By: Rose B
Like purchasing any commodity or service, one has to give full thought before jumping in the transaction. In a way, this is to secure that your finances are allocated for the right merchandise. Further caution must then be taken when engaging in a crucial investment transaction such as short sale homes. Familiarizing yourself with the terms and conditions of buying this real estate category must be considered so as to benefit from a profitable venture.
The short sale process usually occurs when a homeowner falls short of his mortgage dues. The homeowner drafts a proposal to his lender that the property be priced and sold lower than what was owed. If the lender agrees to the set-up, the balance is discounted and the home is put out on the market. With this situation, you can then benefit by being able to acquire ownership of an estate less expensive than market values. This is one of the main reasons why many buyers are enticed with short-sale homes. As an example data from the Phoenix real estate market last year, there are more than 6,000 homes sold under this category. This is in comparison to other cheaper homes under the foreclosure group.
Moreover, to obtain such home is relatively easier than getting foreclosed ones. This is because the latter has to go through more complicated steps. The foreclosure process involves three stages such as the Notice of Default, Foreclosure Auction and Notice of Foreclosure Sale. Each of these steps requires a lot of expenses, time and effort. Thus, buyers and lenders alike do not usually prefer foreclosures over short sales.
Regarding expenses, short-sale homes have lesser of these. In most cases, the lender takes care of the liens, reconditioning or carrying out minor repairs for the home and conducting initial home inspections free of charge. At the same time you are saving your finances, you get to be more secured that the home is ready to be moved in.
Another advantage is that your credit report may also be improved by buying this type of estate. You will be deemed as a credible investor as throughout the transaction, you will always have to foster strong financial capability. And if you go through the short sales, you can earn credit score points massively.
Meanwhile, doing your own research before making an offer is a wise move. An agent with extensive knowledge and experience with short sale transactions will be able to help you. He can oversee the inquiries with the lender regarding how much is still owed under the property before you can put down an offer. He can also deal with the legwork involved in submitting proper documents as required by the seller and the lender.
Once you formulated a fair offer, notify the seller of your endeavor to purchase his property. If the negotiation between you and the seller (and your respective agents) goes well, move on transacting with the lender. Send a copy of your offer. The time frame before you will know your offer has been accepted is about two to three months. While the waiting period seems lengthy, do not be hasty in bidding for other similar properties. Spreading your finances too thin may be crucial.
These guidelines will aid your decision making process whether you are fit to engage in purchasing a home under the short sale category. Deeply think through the positive and negative points in order to emerge as a victorious investor in the end.
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