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Old 05-27-2009, 06:42 AM
 
1,917 posts, read 2,870,907 times
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Default Don't buy a short sale!

I look at it this way: The next step for a short sale is foreclosure. You hear so many sob stories about how difficult it is to buy a short sale so I say DON'T BUY IT. Let it foreclose, then close on it in 30 days.
The term "Short sale" didn't exist a few years ago the same way you would be hard pressed to find "Tilapia" on a restaurant menu! People are able to live in homes without paying their mortgage for over a year now. Their credit is ruined, regardless of the status of their home.
So, I encourage all to wait out these short sales and have you lawyer actually work for a change and check the status of these homes. Lawyers can check how far along a house is to being foreclosed. The banks holding these short sales will be out of business in the next 3 years anyway, who cares how they feel about it.
Believe me, if potential buyers walked away every time they heard the term "Short sale", things would change in a hurry.


Edited: "But" should be "Buy" in the thread title. I can't figure out how to change it.
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Old 05-27-2009, 09:42 AM
 
Location: Concrete jungle where dreams are made of.
8,904 posts, read 6,241,257 times
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We're closing on a short sale in Levittown this Friday. It worked out well for us. We had to wait like 4 months for the banks to accept our offers, but it was worth it for a mint conditioned 4 bedroom house for 275,000.
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Old 05-27-2009, 11:42 AM
 
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Quote:
Originally Posted by Rachael84 View Post
We're closing on a short sale in Levittown this Friday. It worked out well for us. We had to wait like 4 months for the banks to accept our offers, but it was worth it for a mint conditioned 4 bedroom house for 275,000.

CONGRATULATIONS.
A foreclosure would not have taken 4 months and the proporty would have certainly been less expensive. No offense, just using your situation as an example to help prove my point.
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Old 05-27-2009, 11:47 AM
 
Location: Concrete jungle where dreams are made of.
8,904 posts, read 6,241,257 times
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Quote:
Originally Posted by scottzilla View Post
CONGRATULATIONS.
A foreclosure would not have taken 4 months and the proporty would have certainly been less expensive. No offense, just using your situation as an example to help prove my point.

Thanks. But you really risk the house being in very bad condition with a foreclosure. Also, there's a lot more involved with the banks in that case.

This house was an amazing deal and would not have lasted into foreclosure.
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Old 05-27-2009, 12:52 PM
 
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If you are after a particular house that is listed as a short sale, there are some advantages to buying it before it goes into foreclosure.

Simply because it is a short sale does not mean that the owners are currently deliquent on their mortgage.

If they are delinquent and facing foreclosure you have two ways of possibly buying it:

1. You can buy it at the foreclosure auction (on the court house steps). These are generally attended by professionals who know their values very well and will generally outbid you if the deal is really that good. Also, keep in mind that when you buy a house this way, you usually have just 30 days to close and there is no mortgage contingency, so make sure that you either have cash or that you have your financing ready to go. You will lose your 10% down payment if you do not close on time.

If you are the winning bidder, you may now own a home that is already occupied. In other words, the old owners may not have moved out and you will have to evict them. In NYS this can take several more months.

2. You could wait for the bank to foreclose and then buy it from the bank. This is a much cleaner way to purchase a property. However, it also has it's drawbacks as opposed to a regular sale. Banks make no reps and warranties about anything, so make sure that the home has all required certificates of occupancy and such. The bank is not responsible to get them. Also, it may be difficult to perform an inspections, because the banks will usually shut off all utilities and may drain and winterize all the pipes and the heating system. Also, foreclosed homes are often vandalized by the prior homeowners and by others who get into the house.

Personally, I don't like short sales, either. But the alternatives are not that great.
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Old 05-30-2009, 03:30 PM
 
Location: Inis Fada
13,691 posts, read 15,342,853 times
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Are you speaking from experience in the LI NY RE market, or from the West Cobb, GA market?
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Old 05-30-2009, 06:59 PM
 
Location: Blue Ridge Mountains
849 posts, read 1,220,537 times
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I waited for 6 months to close on a short sale in NC back in 2005. I really wasn't trying to time the market, I just fell in love w/ a house. I am not a real estate professional and I wasn't going to take a chance on a court room step to own my house. So, imo, if you are VERY interested in a house and you are patient, I see nothing wrong w/ short sales. JMO
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Old 05-31-2009, 02:23 PM
 
Location: Concrete jungle where dreams are made of.
8,904 posts, read 6,241,257 times
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We've had a lot of frustrations with the short sale we're buying. We were going to close last Friday, but found out that Tuesday that we weren't going to. One of the banks (2 are involved) didn't close by the deadline, so now they have to reassess the value of the house, then we all have to agree on a closing day all over again. This could be another 3 weeks...very frustrating, but worth it for this house.
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Old 05-31-2009, 02:31 PM
 
Location: home...finally, home .
7,852 posts, read 12,086,331 times
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I just edited that for you , scott.
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Be kinder than necessary for everyone is fighting some kind of battle.
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Old 05-31-2009, 03:18 PM
 
1,986 posts, read 2,630,772 times
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In my neighborhood the pattern is this: 1. Outrageous list price. 2. Price drops a few times. 3. Short sale announced. 4. Foreclosure 5. Auction or REO listing. 6. Bank price too high. 7. More price drops. 8. Finally, a sale.

If you love a house, can afford it and won't mind declining value, it still makes sense to buy it. From my neck of the woods, it makes a lot of sense to wait out the short sales. I'm sure some areas have a much different pattern.
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