A short sale is an arrangement of selling of a property by the owner of a house, where the amount of mortgage is higher than the value of the home, and they are unable to pay the remainder in a single payment. However, they must prove to the bank that due to financial distress, they cannot pay the remaining amount of mortgage. The banks usually give approval to this arrangement when the processing fees can be higher in case their clients go into foreclosure. According to experienced short sales lawyers, people often do not understand that buying a short sale can be highly beneficial if done correctly. Rather than solely focusing on the drawbacks of a short sale, they must also consider the advantages that come with this arrangement. Let’s look at this matter in more detail.
Pros and Cons of Buying a Short Sale
The main benefit of buying a short sale is, of course, the money. Banks are willing to complete sale of the house as soon as possible, therefore, sometimes they may offer prices lower than the market, allowing you to get the house in cheaper rates. Moreover, there is less amount of competition in a short sale, mainly due to the long-time wait. It means there are fewer chances of bid wars, which can drive the price up. This further supplements your cause and provides you a better chance to get the house at a lower price.
In addition to that, homeowners continue to occupy the house until it is sold as a short sale, unlike foreclosure. This significantly reduces chances of vandalism or damage to the house. Furthermore, they are unlikely to destroy the property, which can often be the case in foreclosures.
However, there are some negative aspects that you must also consider before opting for a purchase of a short sale home. Ironically, short sales are not completed in a shorter duration. As a matter of fact, it can sometimes, take many months for your offer to be accepted by the bank.
Additionally, it is highly likely that the homeowner(s) did not perform any maintenance or repairs in the house as they may be suffering from financial difficulties. Therefore, it is advised that you conduct a home inspection to ensure that you do not have to deal with these costs later on, which can turn out to be very expensive.
If you wish to get more information about this subject or schedule a free consultation, contact Jackson Abdalla Law Group at (773) 550-3853 to speak with an experienced short sale lawyer.