The Real Estate Investor Tip Of The Week 5 Nov 2009
The Real Estate Investor Tip of the Week 5 Nov 2009
By Zeke Zucaro
SHORT SALE MANIA!
With all the foreclosures afoot there is a new term being batted about: SHORT SALE. You may have overheard someone in the supermarket or at the soccer field whispers of deep discounts and the deal of a lifetime. Or they may be the person on the other end of the transaction relieved to be able to get out from under that crushing Adjustable Rate Mortgage that looked so appealing at the time.
As we come up on the holidays and cocktail party time its important you dont fall behind on the cool conversation at the punch bowl so let me let you in on the big secret and tell you about Short Sales.
A short sale is when the bank takes a discount on the mortgage amount owed on a property. The seller (who almost always in default cant profit in any way) is given the option by the bank to remain in the house while it is up for sale (In the Multiple Listing Service or already under contract) to care for the house and facilitate the sale process. The purchase offers must be approved by the bank and usually are at significant discount to the amount owed the bank by the current owner. This is an advantage to the bank (Saves time and money by avoiding costly foreclosure) and advantage to the current owner as they avoid a foreclosure on their credit report.
Where do you find a Short Sale? Easy, they will advertise and make it clear they are in a short sale scenario and are accepting offers. If you are using a Realtor you can request they query the MLS for Short Sale listings.
Money Saving Tip: Make a serious low ball offer. You are not hurting the seller as they will see none of the money from this sale. You are dealing with the bank and hey lets face it, they can take it!