Short Sales vs. Bank Owned Properties

It's getting tougher and tougher these days to find a house to buy if you are looking to get in to a home in the short term. When looking to buy a home there are three types of homes that are in the market: those where the seller can afford to sell; those where the seller cannot afford to sell and is asking the mortgage lender to take less then what is owed (often referred to as a "short sale" or in some cases "pre-foreclosure") and bank owned properties.

In the past a typical sale was one where the seller could afford to sell. You make an offer and within 24 hours usually you have an answer and then you close within 30 - 45 days. Bank owned properties follow suit in this manner with one difference being that it can take a few days to get the offer accepted and then it can take up to a week to actually get all the signed documents back stating that you are officially under contract. Once the paperwork is received you close within 30 - 45 days.

Short sales on the other hand are not for the faint of heart. When you make an offer on a short sale property it may take anywhere from three to six months (sometimes more) to get an answer from the bank as to whether or not they will agree to take less then the amount owed. In some cases the homeowner ends up in foreclosure long before an answer is ever received and you have to start all over again. In my experience most buyers are anxious to get a new home. If that is your case then you shouldn't even look at short sales as an option. While you can get a home at a great price, most buyers don't have the patience to wait for an answer. The unfortunate thing in this market, with home prices falling, is that more and more of the properties on the market are short sales. If you want a property at bargain prices you will need to do some strategizing and either start the buying process six months in advance so you can take advantage of a short sale property or rule out the short sales and just look at bank owned properties.

For more information on short sales, bank owned properties and the current market call me at 719-330-8531, visit my website: www.YourHomeInTheSprings.com or email me at mailto:donna@yourhomeinthesprings.com