At NyOnlineRealty we are the real estate company that tends to your every need in the market today. We are rolling out a new department in the company strickly dedicated to Short Sales. This is the time that people all over the country are grabbing these homes off the market and profiting big time.

Cnn.com is running a special report on Americas money crisis.  One of the main articles featured was dedicated to Short Sales, and how you can snag a great deal. If you are looking for a bargin check out these tips from Cnn.com about the short sale market.

Know what you’re getting into. In a short sale, you are dealing with several parties: the sellers, their agent and the sellers’ lender. That’s why a short sale can take anywhere between two and six months to execute, compared with about 30 days for a typical sale. Though many banks are willing to take a loss on a mortgage in a short sale if it means avoiding an even bigger loss in a foreclosure, with so many owners trying to unload properties, the lender’s negotiators are flooded with short-sale offers. So if you’re moving or selling another property, keep in mind that you’ll likely need to budget for a few months’ worth of rental payments so you have somewhere to live in the interim.

Find the right pro. Lenders often make realtors who work on short sales take a hit on their commission, so some brokers may be loath to show you the listings. But don’t even think about going solo. These deals take a lot of work and persistence. Before you sign up with an agent, ask him how many short sales he’s closed. If he hasn’t done at least two, find someone more experienced.

Weed out candidates. In most cities, home listings will indicate in the description whether the property is a short sale. Ideally, you want to knock off ones that come with extra complexities. If possible, pass on any home that has more than one lien against it; having to negotiate loans with two lenders can greatly increase the amount of time it takes to complete the deal. Also avoid homes where the seller has other offers. That’s because if another offer is pending, the seller’s agent isn’t likely to even submit yours for approval until the first one is rejected, meaning you’ll have to wait for another negotiation to play out before you even get a chance.

Set the right price. The first step is to have your agent submit your offer to the seller. Don’t just rely on the current list price to come up with your initial bid. The seller’s agent may have far underpriced it in hopes of attracting buyers, but the bank likely won’t accept a lowball offer. Ask your agent to determine the home’s fair market value by searching comparable sales in the area, with an emphasis on other short sales and foreclosures. If the fair market value is lower than the list price, set your offer 10% lower than that.

At this point, you’ll also want to get pre-approval for a mortgage; many banks won’t even consider your offer if you don’t have one.

Protect yourself. Next, the seller’s agent will submit your offer to the seller’s lender. At this point, you’ll be asked to sign a sales contract. See if the lender will agree to pick up all closing costs as part of the contract. Also ask your realtor to specify that you won’t do an appraisal or inspection of the property until the offer is approved. That way you won’t have to shell out hundreds of dollars until you know you realistically have a good chance of getting the home.

Finally, though most lenders will require you to make some kind of deposit along with the contract, don’t put down more than $3,000 before your bid is accepted. That will give you room to put offers on other homes or even to pull out of the sale if it drags on for too long.

Be a pain in the neck. After your offer is submitted to the lender, you’re likely to hear nothing for weeks, if not months. This is no time to relax. Call your agent at least once a week, and make sure the seller’s agent is contacting the bank’s negotiator nearly every day.

These negotiators may have 400 files on their desk. They’ll want to get rid of the squeaky wheels. To help the seller’s realtor in her negotiations with the lender, it’s a good idea to have your agent show her which comparable homes you used to arrive at your number.

If the clock keeps ticking and you’re reaching the end of your rope, try playing hardball.

Keep your eye on the market. When the bank finally sends its counter-offer, use it as a guideline rather than an ultimatum. Most of the time, the lender’s number is based on its own research, that of a local realtor it hires and the outstanding loan balance. Usually its goal is to sell for at least 90% of the home’s value.

The lender’s offer may not be what you’d hoped for, but don’t despair: You have a chance to counter. If the market has been flat since your initial bid, try for 5% to 10% less than the bank’s number. If the market has been sinking rapidly, however, you may be able to prove that the home’s value has shrunk further and offer even less. Once you have the lender’s ear, the new offer should take less time to process.

Contact us now about our Short Sale department at 516-798-3000 and start profiting instantly!

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