Despite the fact that the real estate market may be improving in some areas, there are still some homeowners facing the potential of foreclosure. Many of those homeowners have chosen to list their homes for sale as a short sale in an effort to avoid that foreclosure. If you're in the market to buy and want to get the best value for your money, short sales may be a great consideration. If you want to make the most of a short sale deal, though, it's in your best interest to work with a real estate attorney as well as your agent. Here are some tips to help you get a great deal on the perfect short sale.
Secure the Money Early
Most lenders who are discussing short sales to save a property from foreclosure want to resolve the situation as quickly as possible. If you're trying to buy a short sale, it's in your best interest to be proactive and simplify the process as much as you can. For example, you need to be sure that the paperwork is done as early as possible, including the applications for your financing. If you'll be mortgaging the home, showing a pre-approval for your mortgage will help give the lender confidence that you not only mean business, but you have the means to back it up.
You might be able to use the same lender that the seller is negotiating with. If you're going to borrow from the same lender as part of the deal, just include your mortgage application with the offer drafted by the real estate attorney. This shows the lender that you're serious about committing to this property and helping them recover their loss.
Have Your Attorney Negotiate
Once a property hits the short-sale marketplace, it's already facing foreclosure. That means that the loan servicing for the current homeowner has already been transferred to the foreclosure department of the lender. Most foreclosure departments have strict policies and procedures in place for recovering investments, so they aren't always willing to negotiate or explore options.
To make the most of the negotiation process, start with people who have more flexibility in account decisions. Your real estate attorney can reach out to the loss mitigation department at the lender. This puts your case in front of someone whose sole job is to preserve the bank's investment at any degree possible.
Loss mitigation specialists will negotiate the purchase in an effort to ensure that the bank gets the most they can from the property instead of forcing it to foreclosure and auction, which often results in a substantial loss. In order for this negotiation to take place, your real estate attorney needs permission from the seller, because the account you're negotiating isn't yours – is the past-due account of the seller.
For more information, contact Beran Law Office or a similar firm.