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Chapter 2: Preparing yourself to buy a Short Sale

    Although the current real estate market is at an all time low, REO and Short Sale properties are in high demand due to the bargain prices. The more attractive REO and short sale properties often receive multiple offers, and buyers end up competing with each other for these homes. The Subprime Mortgage Crisis occurrence between 2005-2006 increased the amount of REOs and Short Sales, but as the properties are being sold off, the amount of unsold inventory is lessening. Because of the increased competition, it is best to arrange a couple documents so that you can be prepared when you find a home that you like. If you don’t sort these beforehand, you may not have the time to submit your offer at all.
    Besides a competitive price, you must prepare:

    1. A Full Credit Report (3-in-1 FICO Scores)
    2. Proof of Funds
    3. 1003 Loan Application Form
    4. Pre-Approval Bank Letter
    5. Copy of Earnest Deposit Check

    *You may also be asked to be Prequalified by the specific bank that the property is associated with.

     In short sales, banks have already lost thousands in revenue, and they are usually unwilling to pay for many of the extra costs usually included in a standard sale. Most homes are sold in “as-is” condition. They are unwilling to pay for repairs. They may refuse to pay for termite work, or only pay for a portion. There may be no home warranty and there is usually no disclosure. Thus, your offering price should reflect all the expenses that will be added onto the sale price. That price is usually 10% less than the market price as short sales are a very time-extensive process, and you have to take into account the market pricing months down the line.

    Whether buying short sales or REOs, there are specific tricks of the trade to successfully obtain the home of your desire. This comes with experience and practice, so please inquire with Grace for more information.


Chapter 3: How Do I Get My Offer Accepted?
Chapters for Seller's Guide to Short Sale
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2
3
4
5
6
7
8
9
10
11
12
13
Chapters for Buyer's Guide to Short Sale
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2
3

 

 

 

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