Short sales and foreclosures are facts of life in the real estate market these days. There is a good chance, then, that agents and clients will encounter them when they go to purchase a home or investment property.
Short Sale
Short sale means that the lender on that property wants to sell it and is going to accept less than the current owner owes on it.
Foreclosure
A foreclosure means that the lender has taken back, or is in the process of taking back, the property where the owner has fallen behind on the payments. In either case, buyers will be dealing directly with the listing agent and the lender on the property as opposed to the seller, who is out of the loop at this point.
Processes
Dealing with the lender means that there is another set of processes to go through. Depending on who the lender is, and authority of the listing agency hired by the lender, it may take several days or, in some cases, weeks, to learn if an offer is accepted.
Due Diligence
Once an offer has been accepted and the terms agreed upon, it is up to the buyer to do his or her due diligence as far as a home inspection. Many of these properties are sold as is, and if a buyer has any doubt as to the soundness of anything, he or she has the right to get it inspected at his or her expense. The buyer has a window in the contract that allows him or her to back out of the deal if there are any major issues. Short sales and foreclosures can present challenges.
However, opportunities that short sales and foreclosures offer may be great opportunities for those who are willing to go through the process.