In real estate, a short sale takes place when an outstanding loan against a property becomes greater then the estimated market value of that property. This process is a way in which homeowners can avoid foreclosure and can also pay of their mortgage by reaching a settlement with the lender at the same time.
How a short sale works
In a short sale transaction, a knowledgeable real estate agent asks the seller to provide the required documents—such as income tax returns, closing documents, pay stubs, and bank statements—before listing the property.
Then, through a careful in-depth review of the seller’s current financial situation, a logical way to proceed can be set up, paving the way for a successful completion of the short sale. Short sales are a complex process, for both the buyer and the seller.
Next, the real estate agent will discuss the potential short sale with the lender and inform the seller of the results of their collaboration. When evaluating this information, the seller should always be aware that the lender has more control over the process than either the seller or the buyer, and should strive to maintain a courteous relationship with the lender with that in mind.
Note also that the lender and the seller are actually a partnership, because they both have to agree to the buyer’s offer in order for the short sale to progress.
“Low ball” offers can be a problem
In a short sale, potential buyers are usually hoping to find a bargain, and they sometimes make offers that are unrealistically low in comparison with the property’s estimated market value. As a result, the lender may determine that it is in their interest to proceed with foreclosure rather than accept the potential buyer’s offer.
An experienced real estate agent will realize that this is a possibility, and will make a counter-offer to the buyer before presenting the lender with the problematic original offer. Such “low ball” offers are usually considered to be a waste of time for the lender when it comes to reviewing them, and they often cause the lender to delay in responding, in regard to selling the property, or to ignore the offer altogether.
Virtually anyone who has participated in a short sale agrees that dealing with an experienced real estate agent really made a difference in meeting their needs and satisfying their concerns in going through this complex procedure. The lender is also gratified because foreclosure has been avoided and the buyer or seller, have reached their goals.
Jamie Martin Realtor®
GRI,AHWD,GCREP-GL,CeMS,e-Pro, REO & Short Sale Specialist.
Coldwell Banker Schmitt Real Estate Company
100430 Overseas Hwy, Key Largo Fl 33037
877-289-0035
305-451-4422
305-451-1220 ƒax
E-Mail
www.flakeysproperties.com
