What's a short sale?

Real Estate

A short sale is when the seller is selling the property for less than they owe the bank on it. Once the owner accepts a contract, it is sent to their lien holder to accept, reject or negotiate. A lien holder is not required to accept any of the terms that the owner has accepted. They can renegotiate everything from the price on.

If you need to move by a certain date, a short sale is not for you, since the banks may give you an answer in a month or you may not hear back for a year. There is nothing that the owner or the realtors can do to speed the bank up. With a short sale the home is sold "as is". Neither the bank nor the owner will do any inspections or repairs, so if a municipal inspection is required before you move in, you will have to wait until after you own the property to have the inspection done, then make any necessary repairs and have the home re-inspected before you would be able to move in.

Banks have the ability to consider multiple offers at the same time. They can ask potential buyers for a final and best offer, to determine an offer that they consider the most advantageous for the bank to work with. We never know what the bank will decide to do, and again, the bank may respond to the offers within a month, or it may be a year after they are submitted before the bank even looks at the offers that have been made.

Short sales in general, are not for every buyer.  Typically they work best for someone who doesnt need to move right away. Someone who has time and money to do repairs and updates to the home before they move in (if the owner doesn't have enough money to kerp paying the mortgage, it is VERY doubtful that regular preventive maintenance is being done, much less spending money on real problems).