short sale....

we are moving to an apartment in afew weeks....we want a house but have had no luck finding one right now. We are now thinking maybe to save money we will look at short sales since we have a place of our own we can take our time finding a home.

WWYD? is it worth putting an offer on a short sale?

Re: short sale....

Do you have a short sale house in mind already?

They can be great deals; BUT they can take forever! Dealing with the bank is nothing like dealing with an actual person. It is likely that your offer can sit in a file for weeks before anyone gets to it. I've heard stories where it take months to hear back. If you're not in a rush and potentially have a great house and a great price it's a good opportunity

Re: short sale....

if you can wait then yes, go for it.....short sales are great if you aren't in a rush to close and if you can be patient.....they can take a long time - we offered on a short sale in Jan 09 and didn't end up getting it - it took until May 09 (memorial day weekend) for us to walk away - we had responses from the bank but they were conflicting b/c there were two mortgages and the heloc basically screwed the deal.....then end of july beginning of august we found another short sale (after we swore them off of course!) and we submitted an offer got a response within 2 weeks, inspected and closed....i think from offer to closing was about 2 months - but that is very rare with short sales.....but you can end up in a great house....i had a lot of heartache when the first deal fell through but in the end we got an amazing house and i am SO GLAD we didn't get the first one!

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We were trying to buy a short sale. We actually never got to the point where the bank would sit on it. One of the sellers (they were getting a divorce) all of a sudden became missing....so we signed, the husband signed, and the wife never did...we waited about a month and a half. We just backed out of it yesterday.

So, if you have time to wait go for it. You can get an awesome deal. Just don't get your heart set on it...I hear they often don't work out.

Re: short sale....

I wouldn't go out with ONLY short sales on your list. Short sales are a PIA, from every angle. if you come across a short sale though, and its an awesome house for a great price, it *may* be worth it. It really depends on the conditions. I think you mentioned that you are renting now. If your locked into a lease it may be a pain to assume you will move into a short sale purchase by a certain date because you never really know how long its going to take.

Things to know about a short sale if you don't already know:

Before putting in your offer, you have to have a home inspection done which costs $$ (in NY you cannot have a home inspection clause on a short sale offer) so if your home inspection was to come back horrible, and you have an accpeted offer, you are bound to buy that home.

A lot of vacant short sale homes have no power or water service. Its nearly impossible to do a good home inspection, so you will be buying without knowing a lot about the house

You cannot do a sellers connsession on a short sale

the best short sales to buy, are ones where the homeowner still lives there, (its a good sign the house is livable) and one that says they already have bank approval. This means someone went through the process to attempt to buy the house already. the bank came back and gave them the lowest they are willing to accept. so when you put your offer in, you will be told what the bank is willing to hear. saves a little time.

(if you don't know the short sale process) you see the property, you do a home inspection, you submit your offer to the homeowner. then they accept. you are offically in contract with the homeowner but waiting bank approval. This takes anywhere from 1 week to several months. then the bank gets back to you. If they accept you move forward. Its not often a bank will counter offer, so your offer should be strong and pretty much the most you are willing to pay. (I've heard that banks make you wait awhile, hoping other offers, higher will come in but I'm not sure if its true or not) Until you are in contract with the homeowner AND the bank, your not really yin contract and anything could happen. this is what stinks. Sometimes you give your down payment to the attorney when you go to contract with the homeowner, so that stinks too.

GL-sorry If I don't sound very positive about a short sale. I didn't have a good experience and would never again attempt to buy one again

ETA: if there is more then one mortgage or loan on the home, its is nearly impossible to buy the house, unless you have all cash.

Message edited 10/12/2009 4:27:49 PM.

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The short sale I was buying allowed me to have the inspection and do a 3% sellers concession.

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we bought a short sale, but it took 8 months! If you have time you can get an amazing deal