I have also had a great deal of experience in assisting buyers (both investors & owner occupants) in purchasing short sales, foreclosures & other DISTRESSED properties. I term them distressed due to the financial difficulty of the sellers, & not necessarily due to condition of the property. Believe it or not, I have found some of these listings to be in pristine condition. Some (but NOT ALL!) are being sold considerably below market value, so I often refer to them as Discount properties.

 

I am going to focus on purchasing Short Sale properties in this post & will do foreclosures in a later one. I am also planning a post specifically on purchasing HUD homes.

 

PLEASE DO NOT attempt the purchase of a Short Sale listing if you have any time limit on when you need to close & occupy the property. This can not be emphasized enough & do not take it lightly. There is absolutely no way to gauge the amount of time that it will take the bank(s) to approve of the short sale, so if you have a time limit for leaving a current property, etc., do not attempt the purchase of a short sale listing. I recently closed one of my buyers, who have had an offer in to Wells Fargo which took 5 months! There is absolutely nothing that the listing agent is did wrong & nothing that I could do as the bank was backed up with so many short sale requests, they can not process them in a timely manner.

 

I tell my clients that they are getting a nice discount but they are going to pay for it with patience. They also are going to have to be mindful of other considerations during the long wait like, is the property secure, will the bank come back two months from now and counter to a much higher price, etc.?

 

The purchase of a Short Sale property is not for the impatient or faint-hearted. The waiting can seem like a lifetime. Make sure that you feel very comfortable with the home & the price before entering into what could be a very long wait. I will discuss buying foreclosure properties in the next post.