Blake Morar

Real estate investors can often make profitable real estate purchases through a short sale. But because many buyers don't understand the short sale process, they can become impatient and frustrated while waiting for short sale approval. When considering purchasing a short sale property, it is important that buyer's agents explain the short sale process upfront before a commitment is made. The goal of this post is to clear up the murky short sale waters. I've compiled a list of FAQ's and a step-by-step short sale purchase process. Below you'll find a buyer's guide to short sales: abridged.

As always, I welcome any questions or comments you may have. Below is the best MLS search tool on the market. Use the power search for a more finite inquiry, enjoy!

Click here to view all Short Sale listings in Destin, Sandestin, and 30A.

Frequently Asked Short Sale Questions

What is a Short Sale?

• A homeowner is "short" when a borrower owes an amount on his property that is higher than current market value. A short sale occurs when a negotiation is entered into with the homeowner's mortgage company or companies to accept less than the full balance of the loan at closing. A buy closes on the property and the property is "sold short".

Are Short Sales the best deals on the market?

• Often, short sales may appear to be the best deals on the market; however, this is not necessarily the rule, as some owners have sufficient equity to sell at market value.

Should the offer come in well below asking price since it is a Short Sale?

• The bank will only accept what is fair market value (FMV) for the property. A common misconception is that the bank is so ear to sell that they will take any deal. This is not the case, and banks have been known to reject offers and allow prospective buyers to walk if the offer is not FMV.

Does it matter which bank is making the decision?

• Some banking institutions have a longer approval period for short sale transactions than others. Local banks with a short decision-making chain tend to move more quickly than larger, national banks.

Can we negotiate directly with the bank?

• No. A short sale transaction is between the buyer and seller. The seller is the owner of record. Only the seller and those parties acting on their behalf can negotiate the deficiency with the bank.

Once under contract, what situations can arise that may prevent us from taking ownership?

• The bank may reject your offer; the bank and seller may not come to terms with one another (i.e., the bank asks the seller to contribute money in order to close and they are not willing to do so, the bank will not release the debt, or the bank decides the seller does not qualify for a short sale); the property is foreclosed upon by the bank prior to short sale approval.

Can sellers continue to take offers after they accept our offer?

• Unless negotiated otherwise, yes, this is to be expected. It is very common for buyers to tire of the short sale process and walk away. Back-up offers are insurance for the seller in this case.

Can you ask the bank to pay all closing costs?

• Yes. However, standard buyer and seller closing costs should be expected.

Will a full price offer or greater than list price offer speed up the approval process?

• No. While the bank will appreciate the offer, the approval and seller's deficiency will still need to be negotiated regardless. It is important to remember the key is to focus on fair market value.

Short Sale Purchase Process

Buyers should expect the purchase process to last between four and nine months. Extensions are common and the purchase process is subject to change as each seller's situation varies.

Pre-Approval or Cash with Proof of Funds (to submit with offer) ---> View Properties ---> Make Offer to Seller (with

copy of EMD check) ---> Seller Acceptance/Counter-Offer/Denial ---> Contract (EMD Due) ---> Package Delivered to

Bank for Approval ---> Bank Acceptance/Counter-Offer/Denial (30-60 days after delivery on average)

---> Contingency Period (Inspection, Financing, etc.) ---> Walk-Thru ---> Closing

Wonderful dune front lot in the Dune Ridge section of WaterSound. Enjoy the beachside lifestyle in the controlled access neighborhood of WaterSound. WaterSound is located on the Gulf side of Scenic Highway 30-A in South Walton County.

The wonderful homes and home sites are located in the Dune Ridge Section of WaterSound Beach. Dune Ridge residents enjoy the beachside lifestyle in the controlled access neighborhood, and views of the community's extraordinary dune landscape and the Gulf of Mexico. Perfect for a second home or primary residence, enjoy the solace and luxury of WaterSound's Dune Ridge.

Below is the best MLS search tool on the market. Use the power search for a more finite inquiry, enjoy!

Click here to view all active listings in the Dune Ridge area.

Click on this link to one of my prior blog posts for a more general overview of WaterSound Beach.

Seaside is perhaps the most iconic of all the beach communities found on the Emerald Coast for establishing a pedestrian-scale, master-plan model for controlled development. Seaside is characterized in large part by the traditional style of the south and Florida cottage-style homes. Tower rooms and metal roofs are common elements. Seaside owners and guest enjoy amenities such as casual dining, seasonal entertainment at the amphitheater, boutique shops, private beach access, pool areas and tennis courts. The artist colony of Ruskin Place and the stunning Seaside Chapel are popular among visitors.

Seaside offers single family homes and home sites, as well as condominiums.

Click here to see all active listings in Seaside, FL.

Destiny By The Sea is a private beach front community consisting of single family homes and home sites of varying size and sophistication. This attractively fenced and gated community is the only community located entirely on the south side of Scenic Gulf Drive, a popular location in east Destin, Florida. It is about 10 miles west of the Beaches of South Walton and Scenic Highway 30A.

Destiny By The Sea is the premier gated community on the Gulf of Mexico in Destin, Florida. It's architecture exemplifies beach front luxury and the carefree beach life on the Emerald Coast. Most of these single family homes are Mediterranean-style villas featuring, deep covered porches, secluded courtyards, barrel-tile roofs and rooftop terraces with outdoor kitties, hot tubs and the occasional swimming pool. These gorgeous homes embody luxury living in Destin with sweeping views of the Gulf and it's dazzling white dunes.

Residents enjoy an owner's beach club with sunset wet bar and courtyard. Surrounded by lush tropical landscaping, there is a heated pool and whirlpool spa. Owners and guests enjoy concierge service as well as a private stretch of recently renourished beach front and multiple beach access points for those directly on the water. Destiny By The Sea is perfect for residential families and also for a vacation or second home investment.

Destin Real Estate Company holds market superiority in Destiny By The Sea and specializes in the listing, marketing and sale of properties there. Currently, there are many great short sale opportunities in the neighborhood- don't hesitate with any questions you may have.

Click here to view all active listings in Destiny By The Sea.

Seacrest Beach, a colorful beach community, is located on the northeast end of Scenic Highway 30A. Known for it's Florida cottage-style homes with clapboard siding, vidid trim and shutters, and playful porch rail pickets, Seacrest Beach is a vacation spot the whole family can enjoy. The symmetric neighborhood blocks of Seacrest beach surround the largest pool on 30A- a lushly landscaped tiered lagoon pool spanning 12,000 square feet.

Within close proximity is the Village of South Walton, home to popular shops and restaurants including Arraiga Originals Gallery, Kent LTD., La Cocina and Destin Chops. It's fountains are a kids favorite on hot Florida summer days. Seacrest Beach residents enjoy a deeded beach access with tram service during the summer months.

On the south side of Scenic Highway 30A, Villas at Sunset Beach is a popular gated condominium project on the Gulf that shares the amenities of Seacrest Beach. These condos enjoy exceptional Gulf views of the Emerald Coast.

Another notable gated community is Water's Edge at Seacrest Beach, a neighborhood of single family homes and home sites on the Gulf across from the Village of South Waton.

Seacrest Beach is within 30 minutes of the Northwest Florida Beaches International Airport. It is conveniently located between Alys Beach and Rosemary Beach, granting access to the unique restaurants and shops of each community. There is plenty to do and see on this beautiful family friendly resort.

Click here to view all active listings in Seacrest Beach.