Yes Virginia short sales do get to closing. Is it the easiest route to homeownership? No the easiest way is to find an owner who is aware of the current market conditions in Northern Virginia and prices their home to reflect the market. Can a short sale work for buyers who are looking for a good deal and have patience to work through the process? Absolutely!
As an agent who has worked both sides of short sales there are some tips that I've learned along the way. For buyers who are considering making an offer on a short sale you need to be aware that no matter what you include in the Virginia Regional Sales Contract the lender will have their own addendums which will supersede just about everything you put in the contract. This doesn't mean that you shouldn't write a contract with the terms and conditions that meet your circumstances but it does mean you need to be prepared to be flexible about closing dates, inspections and closing cost credits.
If you are firm that it is your way or no way because this is a "buyer's market" then a short sale will leave you feeling frustrated and angry. The processors handling short sales don't really care about what you want. They are running the numbers to see how much they can walk away with at the end of the deal. It is strictly about the bottom line for them.
For agents who are thinking about making an offer on a property listed as a short sale there are a few key questions to ask before you write the offer.
Does the agent have permission from the owner to talk directly to the lender?
Has the agent been in touch with the lender and have appropriate contact numbers?
Has the owner completed the short sale package from the lender?
Has the owner prepared their hardship letter?
How many loans are currently on the property? If more than one loan are they from the same lender?
Who is the lender (s)?
Have you done a pre-settlement statement for the lender?
How long do you estimate that the lender will take to provide an answer?
While buying a home listed as a short sale may be more time consuming in the end you will get a home a good price without some of the problems associated with properties already owned by the lender. If you are interested in learning more about purchasing a short sale or have a home that you are considering listing for sale give me a call. I'll be glad to talk to you about the process and see how my team can help.
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As an Associate Broker with RE/MAX Allegiance in Northern Virginia and native of the area I can assist you whether you are buying, selling or renting a home anywhere in Northern Virginia. For more information about the area or my services you can check VaRealEstateTalk or my Northern Virginia website.
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Nice post! I've been on the listing side as well as the buyer's side of a short sle, and these are excellent points for anyone involved to keep in mind!
Really great questions to ask, Cindy. A short sale is definitely much smoother with those matters taken care of. You are so right about the processors -- that job is all about the bottom line numbers. That is an important point to make clear to all parties.
Marlene-they can work smoothly if everyone stays in communication and has their ducks in a row.
Elaine-thanks for you comment. The processors hold the key to getting the transactions finished. I just got the final paperwork back for one of my buyers and it only took about 3 weeks. The listing agent was on top of everything.
I love your comment about the "buyer's market". Those words are so true. Whether a bank sale or a short sale it is amazing how many times I have to remind my buyers that they are not in control despite the current market. It is an interesting place to be.
Buyers are not in control when it comes to making offers on short sales or foreclosures. It is up to us to be educated and provide them the best guidence we can to help them make informed decisions and get through the process.
CINDY - Thanks for providing the checklist of questions. I have some buyers that are interested in checking out short sales now. I will only do so after filling them in on the potential pitfalls and frustration that they may have to deal with.
Great. I will add these.
How many of these have you done?
Frank
Frank-Check out "The Tale of the Short-Short Sale". I have three offers working now on listing and this isn't going as fast but the BPO has been done and the negotiator got the package on Friday. This one is at three weeks so I won't beat the last one. I closed one late last year before we were officially screaming short sale in 6 weeks. I'm not sure how many I want to take on as they are time consuming and I'm busy with foreclosure buyers.