You have chosen me to represent you in the purchase of your new home. As your agent, I have a fiduciary duty to get you into the home you choose for the best price and with the best possible terms. So, what if you ‘fall in love’ with a short sale?
Here is the key about Short Sales: There are absolutely no guarantees the seller’s mortgage lender will approve your offer and provide an approval letter for the short sale transaction. Furthermore, it could take up to 90-days to find this out!
Steps to Protect You
What if you have executed a purchase contract with a seller and the offer has been submitted to the seller’s mortgage lender for approval and now you are in the waiting period? Well, basically you are in limbo while other attractive homes come onto the market that you will be ‘missing out’ on. And, what if you wait and wait only to find out the mortgage company will not accept your offer – this is very frustrating!
Your Buyer’s Agent should have in place a few steps to protect your interest when purchasing a short sale property. Here are examples of a few of them:
- Pre-Qualifying the property AND the Listing Agent: There are ways to determine what the property’s status is within the short sale process. Specific questions can be asked of the Listing Agent to determine if they are ‘on the ball’ and whether or not working with them will benefit the buyer. In some cases it becomes evident that the buyer should simply – move on to another property.
- Prepare the Purchase Offer with an ‘OUT’: The State of Florida real estate contract has a short sale addendum that allows for the input of a specific time period amount for the mortgage lender’s approval. When considering a short sale property, the buyer should already be aware the process is likely to take longer than a standard purchase on a non short sale property. It is important for the buyer to discuss the time frame they are willing to commit to the property with their Buyer’s Agent. In doing so, the Buyer’s Agent can then include this time frame limit in the contract allowing the contract to become void if approval is not obtained by the deadline.
- Know a few tricks to get you into a short sale quickly: Short Sale transactions take longer to close than standard purchase transactions. Many times, buyers will become disillusioned and back out of the transaction. In many cases that transaction will remain in the approval process with the mortgage lender. It can be possible to become the ‘replacement buyer’ on such a property. – ask me how…