Real Estate 101 - An Introduction to Short Sales

Short sales are different from the normal home sale process. Prior to considering or purchasing a short sale, it is critical that you understand them and how they work. Below is some general guidance on purchasing Charlotte NC short sale homes.

An Introduction to Short Sales

Short sales refer to homes where the sale price and expenses will not be sufficient for what the property owner would need to pay expenses, and the seller has no money to make up for the difference. Expenses related to the transaction may include the equity lines on the property, real estate broker commissions, property transfer fees, and other applicable costs. The bank on the property would be short what is owed to them, which is where the phrase short sale comes from. The banks maintaining the liens on the home for sale must each agree to the sale in order for it to go through. This is where it may get tricky. To obtain approval, sellers must provide certain financial paperwork, hardship letter, and a contract from a interested buyer. Homes marketed as short sales can only be purchased pending this approval, and there are no guarantees that it will be.

Pros of Short Sales

The number of short sales available has a lot to do with the real estate market.  Sometimes, there may be a large number of inventory.  Short sale homes are usually a chance for home buyers to receive a reduced price on homes.  However, they do not work for all buyers.

Short Sale Disadvantages

Short Sale Timelines

Home buyers must move forward with an offer to purchase without any guarantee that the sale will be approved. It can also take significant time to hear back on the status (easily a few months or possibly a year). Thus, short sales may not be good alternatives for home buyers who need to close during a specific tine frame.

Potential Repairs

Short sales can often need a lot of work. They are normally sold in its existing condition since the seller is not able to make repairs and the lenders are already receiving less than what they are owed. Buyers must be able to handle renovations afler buying the home.

Purchasing Charlotte NC Short Sale Homes

Short sales do not fit everyone. Home buyers must be aware of the uncertainty before placing an offer on a short sale. For buyers with flexibility and the capability to make repairs, it may be a great opportunity to save money on a property.  Speak with your real estate agent for additional facts on purchasing Charlotte NC short sale homes in your neighborhood.