Are you a real estate investor? If so, you may be considering buying a short sale property for the first time.
Many lenders prefer to opt for short sales because the costs associated with foreclosure can be significant. There’s the cost of serving papers and evicting the homeowner, plus the lender is then responsible for maintaining the property until it’s sold. For this reason, many lenders opt for a short sale, which also benefits the homeowner since they can get out of a property that they can no longer afford.
Buying short sale homes can bring many benefits to you as a real estate investor, making these homes very popular amongst investors. Here’s a look at a few of the many benefits of buying a short sale as your next investment property.
Short Sale Benefits: Cost
The cost is the most significant perk of buying a short sale property. These homes are generally very competitively priced.
In a typical home sale, the seller is directly impacted by how much you pay for the property, but in the case of a short sale, the homeowner is minimally affected by the purchase price. For this reason, they’re generally apt to move forward at a much lower price than they would otherwise.
Of course the lender must approve your offer in order for the sale to move forward to closing, but again, they usually accept a much lower price than you would typically pay in a traditional home sale because the lender is interested in avoiding foreclosure and recouping their money as quickly as possible.
Short Sale Benefits: Fix and Flip Potential
In a traditional home sale transaction, the seller must perform various improvements or repairs. But this isn’t customary in short sale transactions, meaning the home is generally sold for a lower price which is ideal for property investors who are in search of fix-and-flip homes.
Short Sale Benefits: New Legislation
In the past, short sales took a long time to arrive at the closing table – a fact that deterred many real estate investors from buying short sale homes. Many lenders would drag their feet in reviewing and approving the purchase offer on a home.
But today, new legislation is in place to prevent months-long transactions, resulting in more rapid short sales — something that is a benefit to both the buyer and the seller.
Navigating the short sale process can be a challenge, but this is where you can benefit from working with a short sale expert like Kristine Zelazo, better known as the Short Sale Gal! Call Kristine today at 800.664.0616, x802.