In today’s economy, short sales have become increasingly popular. A short sale, or when the homeowner sells the home for less than they owe on their mortgage, it can mean getting a great deal for the new buyer. However, these transactions aren’t without their challenges. As they are often lengthy, the homebuying process can add some additional stress to the buyers. Therefore, we have comprised a detailed list on how to handle these transactions. When the process is all said and done, be sure to protect your new investment with a NJ High-Value Home Insurance policy.
Enlist the help of an agent.
According to House Logic, a real estate agent experienced in short sales can identify which homes are being offered as short sales, help you determine a purchase price, and advise you on what to include in your offer to make the lender view it favorably. Further, finding an agent who has successfully closed short sale transactions in the past is ideal to ensure they have the right experience.
Build a team.
Gather a relevant team to aid in the process including real estate attorneys and title agents. A title agent will be able to provide information on how many liens that are attached to the property. As all lienholders must approve of the short sale, this process can be more complex and tedious if there are multiple holders.
Understand the fair market value.
Consult with your real estate agent to determine a fair offer price. Lenders are already consenting to lose money on the home when new buyers purchase the home, and offering too low of a price can result in immediate rejection. Offer a fair market value number and minimize the losses for the previous lenders to increase your chances of being approved.
Prepare your financing.
If you’re preapproved for a mortgage, have a large down payment, and can close at any time, they’ll consider your offer stronger than that of a buyer whose financing is less secure, says the article.
There are two parts to any short sale, so expect delays. The seller must agree to your purchase offer first, and then they must get it approved by the lender. This process has been known to take a while, so be patient and expect for it to take longer than originally anticipated.
About Tri-State Insurance Agency
At Tri-State Insurance Agency, we are committed to protecting homeowners against the broad spectrum of perils they face. Whether it is your full-time residence or vacation spot, our high-value homeowner’s insurance is custom written to meet your specific needs and offers higher coverage limits and inclusions that traditional policies. For more information, contact us today at (888) 990-0526.