I get a lot of homebuyer inquiries from my website and one common theme from all of them is their desire to â€˜find a great deal.â€™ Regardless of price range, virtually every potential buyer that I communicate with mentions either â€˜foreclosureâ€™, â€˜short saleâ€™, or â€˜dealâ€™.
I am sure most of you know what a foreclosure is but sometimes I run into people who donâ€™t know what short sale means. Essentially, a short sale occurs when the proceeds of a real estate sale are insufficient to cover the liens or financial obligations owed on the property.
For example, if a home is worth $500,000 and the homeowner has a $600,000 mortgage on the property and the owner cannot make up the difference then a short sale is required. For a sale to take place the mortgage holder would have to agree to take less than what is owed to them due to an economic or financial hardship on the part of the borrower.
This process can take months to accomplish. If you are looking to purchase a property in short sale make sure you have plenty of time and patience. If you need to move into a home quickly it might be best to exclude short sales from your list.