Explaining The Complex World Of Short-Sales

Explaining The Complex World Of Short-Sales

A lot of people ask me, “exactly what is a short-sale?” There are a lot of Huntington Beach homes for sale which are deemed “short-sales”. As a Huntington Beach Realtor and Orange County Realtor people usually have two questions regarding short-sales: What are they, and how do you buy them.

What Is A Short-Sale:

A short sale is a real estate sale in which the proceeds from selling the property will fall short of the balance of debts secured by liens against the property. The property owner cannot afford to repay the liens’ full amounts, whereby the lien holders (aka the bank) agree to release their lien on the real estate and accept less than the amount owed on the debt.
A short sale is often used as an alternative to foreclosure because it mitigates additional fees and costs to both the creditor and borrower; however, both will often result in a negative credit report against the property owner.

QUICK TIP: Don’t short-sale your home unless you absolutely have too! A lot of agents try and talk home owners into selling their homes short, and the reality is they didn’t have to. Banks are willing to work with home owners to restructure their loan to lower the payment so that the loan payment can be made. I know people who have successfully done this, and have actually lowered their monthly payment; thus, getting to keep their home.

Buying A Short-Sale:

Buying a short-sale property takes a long time. You first have to submit the offer to the home owner for acceptance, then the bank has to accept the offer as well. The whole process is riddled with red tap. This process normally takes twice as long as a standard sale would. In the past it was worth the wait because the bank’s were willing to accept less favorable deals due to the fact they needed cash for their balance sheets. However, the banks are less likely to make the buyer a favorable deal. Now I’m seeing the banks will only accept sticker price offers due to the fact they are no longer desperate for cash. Another reason I conclude from their recent lack of negotiation is they must think the bottoms in for the housing market, thus are willing to sit on the asset as it is now appreciating. This is favorable for their balance sheet.

If you are facing a short sale please contact me right away by clicking “Lets Get Started”. I can let you know if you need to sell your home short, or if there is a chance you can actually restructure your loan, to lower your payment, and save your home. If your interested in buying a short-sale also contact me. I have a team of experienced short-sale experts to help us with cutting all the red tap so that you can get your short-sale home quicker, and for the best price.

Malakai Sparks
malakai@tmsg.me
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