Feb 23
A bank short sale allows for a buyer to purchase a property for less than market value; however, for a successful real estate transaction of this sort, it is important to quickly and correctly identify and research certain specifics concerning the property in question. These specifics include indentifying the correct and current owner of the property, how much is currently owed on the property, how many mortgages are associated with the stated property, if and when foreclosure proceedings have been associated with the property, and how much the real estate is worth at market value. It is not only important to correctly identify these characteristics, but to do so in a timely and quick manner as short sales are only offered for a limited time before a foreclosure is pursued.
Fully researching a bank short sale opportunity can save valuable time and increase the likelihood of a successful real estate transaction. The most efficient way to research a potential property is to check public records. The first fact that you need to identify is the current and correct owner of the property. The loan officer at the attending bank or lending institution can give a name. However, this name is not always the direct owner of the property in question. A property can be owned through companies or corporations and ultimate ownership may trend through several different levels of authority before terminating at the proper owner. To determine the proper owner you can question an officer at the local courthouse. They should be able to give you a name by searching through tax and property records.
Once you have identified the proper owner of the property in question, then you can begin the process of purchasing a short sale. However, you must also determine if the property is worth the trouble and risk of the process. You have to find out how much the property is indebted to the bank or lending institution. The loan office can assist you with this aspect of the research or you can once again reference tax records. This will help give you an idea of how much to offer for the property. Remember that the bank only wants to regain the capital lost through the initial defaulted loan or mortgage.
It is also a good idea at this point to check the official documents to see how many loans have been borrowed or mortgages issued against the real estate in question. If there is more than one loan or mortgage, then the property is probably not a good candidate for a short sale as the lending institution will most likely force foreclosure proceeds. If foreclosure proceedings are initiated, then a short sale is not possible as this procedure is meant as a last financial option to avoid foreclosure.
One more aspect that should be thoroughly researched before you enter into any bank short sale is the comparative market value of the associated with the real estate in question. This will help you decide which properties are worth pursuing and which ones are probably bad investments. Look for properties that have a high market value.
The key element to successful short sales is research. By knowing the financial and legal details of the property’s history, an investor can better assess the potential value of a given real estate transaction.
Feb 02
A Bank short sale is a great way for investors to buy property at a fraction of the market price; however there are several steps that should be followed in order to guarantee a successful and profitable transaction. These tips include using a real estate agent experienced in the short sale process, doing research on the short sale specifics, identifying the correct owner of the property, file all associated paperwork in a timely and efficient manner, and completing a thorough inspection of the property before finalizing or signing any papers.
Not all real estate agents are familiar with the short sale process. Some professionals view the process as a last ditch effort by banks or other lending institutions to sell off debt accumulated through bad loans and therefore avoid such proceedings. However, this could not be farther from the truth. Many agents have discovered that a short sale is a great way to acquire property at greatly reduced prices and have begun to specialize in such dealings. These are agents you want to seek out, both for their experience and their connections. They will be able to guide you through the process step by step.
Another important tip is to fully research the short sale specifics. The best way to find out information on a particular property is to check the public records. In this manner you can discover who is on the title for the property. You can also find out how much money is owed to the bank through the property. This will help you determine a proper asking price to approach the mortgage holder with. The proper price should approximate the amount owed to the lending institution. You should also be able to discover if the property has been foreclosed upon. If these proceedings have been initiated, then a short sale is not possible. Bank short sales can only be completed during pre-foreclosure proceedings. You can also find out if the property in question has multiple loans against it. Avoid properties with multiple mortgages against it.
A short sale is a quick process that must be completed before the property moves into foreclosure. This means that time is usually of the essence. Paperwork must be filed out in a timely manner and documents must be completed according to strict deadlines. Make sure that you attain all the associated paperwork during your initial visit to the bank or loaning office. Not attaining all of the paperwork in the initial visit can lead to time consuming delays that may derail the short sale. Also make sure to ask the loan officer for a list of all required documentation needed for a successful short sale. Missing only one piece of paper or one simple omission of information can make a short sale unsuccessful.
Finally, once all of the paperwork has been completed, the proper documents filed, and the research has been done, it is a good idea to have the property in question inspected by a licensed home inspector. Many properties fall into disrepair when they fall back into the ownership of the bank. Therefore, it is wise to identify all the current issues associated with the assumption of ownership. After all, a house isn’t worth much if it needs a completely new foundation. Still, it is certain anyone looking for investment properties; a bank short sale is usually always profitable.
