Short sale tips from an expert in the field
Having spent years in the distressed real estate investment field, I have learned what it takes to be profitable and how to avoid the pitfalls that come with this kind of financial opportunity. Here are some short sale tips that can help you gain a competitive edge in this field.
SHORT SALE TIPS FOR THE SELLER
If you’re looking to short sale your home, then you can expect to hand over plenty of personal financial information to the bank. The lender is going to demand proof that continuing to make payments is going to be a real hardship.
A brief list of short sale tips includes:
- Lost or reduced income
- Job loss or involuntary transfer
- The value of the home is less than what is owed
- Financial emergencies like health care bills
It’s important to note here that poor financial decisions do not constitute an emergency. If you decide to buy an RV for vacations and can’t make the payments on that and your house, the bank is not going to show any sympathy.
Some real estate agents specialize in handling short sales. Sometimes these agents also have a list of investors who buy short sale properties. Lenders may also know people who’d be willing to buy a short sale property. They can also supply short sale tips that work well in that market.
NO OTHER OPTIONS
If you can refinance to get a lower payment, you’re probably not going to get a short sale.
If you file bankruptcy, this ends a short sale. The bankruptcy process stops collections efforts on bills you owe, including a mortgage. No list of short sale tips provides a work-around once the bankruptcy process is begun. The bankruptcy judge can rule to allow a short sale, but this is uncommon.
Sometimes the bank requires you to be in default on your mortgage before it will consider a short sale. If this has already happened, start negotiations.
If the loan is current, but problems are on the horizon, my list of short sale tips starts with: Begin negotiations immediately. Several mortgage programs will let you buy a new home immediately after a short sale if you were not behind on payments with the home you had to sell.
If a short sale has to happen, Fannie Mae has some short sale tips.
SHORT SALE TIPS FOR THE BUYER
Just like the seller, making contacts with people who handle short sales is a quick route to being in the right place at the right time.
Contact real estate agents in areas where you’d like to invest. They understand the local market and have area-specific short sale tips to help you buy property.
Advertise in the area in a newspaper’s classified sections or shoppers. Get online with Craigslist and other free want ad websites.
Decide ahead of time how much you are willing to spend and stick to that. The question becomes, how much to offer?
Freddie Mac’s website suggests going in with a realistic offer. “Like buying any property, to increase a buyer’s chances of success, the offer needs to be competitive. In the case of a short sale, the offer may need to be closer to the market value of the property rather than the list price. Short sale listings are often priced low for the purpose of attracting multiple offers,” the website states. There are more excellent short sale tips on the page.
You do need to figure in the cost of any needed repairs as part of your bid. Some short sales will be in great shape, but more likely the home will need work.
If the homeowner has had trouble making payments, routine maintenance probably got pushed aside in favor of just keeping the roof in place. A home inspection will tell you what needs to be done and provide a cost estimate.
The more money you can put down on the property, the greater your chances of buying the home. No amount of short sale tips beats cash on the table.
As Elizabeth Weintraub says, “Just because a property is listed with short sale terms does not mean the lender will accept your offer, even if the seller accepts it.”
The bank is going to evaluate the offer, the buyer and any other offers it may have.
If you’re a short sale seller, document your hardships, and be aware of what the bank considers to be a hardship or not. Finding a real estate agent who specializes in short sales can be very helpful. Also, learn how filing bankruptcy or being up to date on your payments could affect your short sale.
If you’re a short sale buyer, finding a short sale real estate agent could also be very helpful to you. Be sure to make a realistic offer and have the funds available. Get the home inspected before you buy it, since a distressed seller is not as likely to have kept up with home repairs.
While short sale investing can yield real estate bargains, it is a slow process that can be complicated, and in Ted Thomas’ over 30 years of experience in real estate investing, he has found a better alternative.
If you’re interested in buying properties for 10, 20, or 30 cents on the dollar and with no mortgage, Ted invites you to take a closer look at tax defaulted property investing. You won’t be disappointed.
Tax lien certificates pay guaranteed returns of 16%, 18%, 24%, up to 36%, and tax deed properties can be purchased for pennies on the dollar, if you have the knowledge, know the rules, and do your homework.
Ted is so confident that you’ll see the big profit potential of tax liens and tax deeds, that he’s offering you his Safe Haven Investor System course (valued at $197) right now for FREE.
Ted Thomas specializes in distressed properties, and he’s America’s Leading Authority on Tax Lien Certificates and Tax Deed Auctions.
What makes Ted Thomas different? He doesn’t just give you a home study course and send you on your way; he offers a complete support system to ensure that you have the best chance at success.
Ted Thomas has a team of coaches and guidance facilitators, offers Monday through Friday live webinar classes to help students with research, weekly Zoom webinars to enable students to ask experienced Ted Thomas coaches tax lien and tax deed questions and get expert answers, a resource center, and live workshop events.
Nobody else has support like Ted Thomas, and Ted wants to give you a big head start by offering you the Safe Haven Investor System for free.
Safe Haven is 2 hours of streaming videos and a 100-page illustrated manual that teaches you all about tax liens & tax defaulted property investing, so act now and get your Safe Haven course today.