If you are looking for a house to buy and are considering buying one that is listed for sale as a short sale, you should understand what you are getting yourself into if you decide to go through with the purchase of the house. Buying through a short sale is not a fast and simple process in most cases, and here are some of the pros and cons to be aware of as you proceed with this type of purchase.
The pros of buying a short-sale home
The number one reason a person would go after buying a short-sale home is for the discounted price of the house. A person that is selling through a short sale is someone who is on the verge of losing his or her home. This person's lender would have to agree to let the borrower sell the home through a short sale for this to happen and selling through a short sale can help the person prevent foreclosure from occurring.
When a lender agrees to allow a short sale, it means that the owner of the house is free to sell the house for a price that is under the current balance of the mortgage. What this means for buyers is that they are able to purchase homes through short sales for prices that are under the market value. If the deal can go through, a buyer can instantly have equity in the house he or she just purchased.
The cons of buying a short-sale home
When it comes to the downsides of buying a short-sale home, there are several to understand. The first is that before you can buy a short-sale home, the lender must agree to accept the amount you are offering, and this does not usually take place overnight. There is a process that lenders go through when allowing short sales, and the steps of the process take time. If you are in a hurry to buy a house, this is probably not the best way to go about buying it.
The other thing to know is that you might inherit liens on the property or find out that the house needs work, and you will be responsible to pay for these things if this is the case.
Buying a house through a short sale is not necessarily a bad idea, but it is different than buying a house through the traditional method. If you would like to find homes for sale that you might be interested in, contact real estate companies like Rodney Bean Real Estate & Investment today.