A short sale is a chance for you and your family to get a good home for below market value. However, there are some potential downsides to buying one that you could encounter if you are not careful. If you are considering a short sale, here is what you need to know.
What Are the Potential Drawbacks?
There are several potential problems with buying a short sale. One of the biggest issues is that the home is sold as-is. No matter what the condition of the home is, the seller does not have to make one repair. Depending on the repairs needed, you could buy a home that requires thousands of dollars to make livable.
Despite the name, short sales can take a considerable amount of time to buy. Even though all your discussions have likely been with the seller, you also need the approval of the lender to buy the home. It could be months before the lender agrees to the sale. In the interim, the seller could move out of the home, which could mean months of vacancy.
The time the home spends vacant could have a negative effect on it. For instance, without electricity to operate the heating and cooling system, there could be a humidity buildup in the home. The moisture could leave mold and mildew growing in the home. Before moving into the home, you could face expenses for mold removal and repairs of any structures damaged.
What Can You Do to Protect Yourself?
Even though there are some drawbacks to buying a short sale, it is still worth exploring. Not only can you save on buying a home, but you can get more bang for your buck. With the right moves, you can protect yourself and make a sound investment.
One of the most important steps you can take is to work with a real estate agent who has experience in short sales. He or she will be able to help you find homes that are in good condition and set the price that you should offer to the lender.
Although you cannot push the lender to decide on your offer sooner, you can make sure everything on your end is handled. Check with your lender to ensure you have the approval needed to buy the home. You should also have your down payment on hand to prove that you are ready to move on the deal at any time. The more prepared you are, the less likely the home will be left vacant for long.