Real Estate News Update
Real Estate News Updates
The news are very positive for the real estate market. Take a look at the video that speaks about what is going on in the market today.
Click here for August 2009 video update
And to get an update from the Association of Realtors regarding the $8000 tax credit downpayment
Click to get the latest on the extension http://tinyurl.com/yaw2n3d
Click here for July 2009 update
What is a short sale?
A short sale is when a lender accepts a discount on a mortgage to avoid a possible foreclosure auction or bankruptcy. Instead of buying from a seller, you are purchasing the property directly from the lender for a discount. For example: A homeowner, who is facing foreclosure, has an existing first mortgage of $300,000. You write an offer to the lender for $220,000, which is accepted as full payment for the loan."
Pros and cons of short sales
Pro: Getting the property for less than what it would cost for the owner to reinstate the mortgage can be a windfall for the buyer.
Con: Short sales can require more work on the part of the buyer who must also qualify for the transaction -- and often be able to pay entirely in cash.
Did you know?
- Frankie Orlando, the author of The Pre-Foreclosure Real Estate Handbook, says that Fannie Mae and Freddie Mac will accept 85 to 90 percent of the fair market values in a short sale, and HUD will accept as low as 82 percent.
- To make a case for the short sale, the buyer needs to compile paperwork to prove to the lender that the homeowner qualifies for a short sale payoff.
- While a first mortgage will be satisfied in a short sale, buyers also need to consider any secondary liens against the property.
- Lenders will more seriously consider short sale offers that are entirely in cash, with a 30-day-or-shorter closing and no contingencies.
- The seller or property owner cannot profit from a short sale.
What goes in a short sale packet?
Since the average layperson is not familiar with the many nuances and legalities of most real estate transactions, including short sales, working with a Realtor® who specializes in this area can save prospective buyers a lot of aggravation, time and money. You will need to present the following to a lender for any short sale:
- Cover letter
- Purchase agreement
- Low comps list
- List of repairs with quotes for bids
- Photos of problems with the house
- Seller's hardship letter
- Net sheet (HUD-1)
- Financial information on seller (W-2s, tax returns, etc.)
- Your formal offer, with a time limit for acceptance.
For more information about Buying or Selling a Property that is a short sale please contact us by filling the form bellow or call us at 786-273-7577 or write to team@jklahr.com
