What would be better to buy: short sales or foreclosures?? (approve, requirements)

[Mrs.Bewitched]

If you had to! Where I am contemplating buying, it is full of a lot of short sales and/or foreclosed homes. I know by reading here that short sales take a loooooong time-usually.

So what's the deal with what would be more preferable?

[renriq02]

foreclosures may take awhile also as some states have upset bid requirements. You win at the auction but you will need to wait 10days to see if there's an upset bid.

Foreclosures maybe a better buy ...... but also depends on who you're buying it from. I havent done a HUD home in a while but they required 15business days to approve your offer.

Shortsale might be a lot easier but you wont get the equity that you'll get with a foreclosure.

hope this helps!

Originally Posted by mrshvo

If you had to! Where I am contemplating buying, it is full of a lot of short sales and/or foreclosed homes. I know by reading here that short sales take a loooooong time-usually.

So what's the deal with what would be more preferable?

[ChipL]

Short sales can take a long time. I've been working on one for about 6 months now and still no final word from the lender. That's not to say they're all that bad, but they can be time-consuming.

Find out what the rules are for foreclosures in your state. Like the previous post mentions, NC has a 10 day upset period where anyone can come in with an offer 5% higher than the previous offer and then the 10 day clock starts again until there are no further bids.

Some states have a redemption period whereby the original owner can come back up to 12 months after the sale and redeem the original loan. Big ouch if you were to invest in one of those.

Personally I prefer foreclosures, but make sure you do your homework, see how your state does it, and make your own decisions. And that's not to say you can't work both angles.

[ISellAddison]

From my experience (and this is just my opinion), I find the short sale homes to be in better condition. Usually the homeowner is still living there and has some pride of ownership. I've seen foreclosures with everything removed - toilets, dishwashers, sinks, etc. Of course all foreclosures aren't like that, but some are.

[rcarrillo]

Originally Posted by ISellAddison

From my experience (and this is just my opinion), I find the short sale homes to be in better condition. Usually the homeowner is still living there and has some pride of ownership. I've seen foreclosures with everything removed - toilets, dishwashers, sinks, etc. Of course all foreclosures aren't like that, but some are.

I have seen both in good condition and trashed. I have seen many short sales were the owner gave up and was not taking care of the home, knowing they were in trouble and would make $0 on the sale.

Both can take a long time. I have had short sales close late becuase the lender was still reviewing the settlement statements and negotiation for every penny. HUD does take a long time to approve offers and to review documents for closing as well. Bank owned foreclosures are usually quicker and have less restrictions in my experience.

Reseach both! Don't count out regular home sales either. It is a myth that foreclosures and short sales are always a bargain, sometimes a motivated seller will offer better value than both.