Short Sales Are Short on Results

Are you a homebuyer or investor that thinks buying a “short sale” listing will get you the best deal in today’s real estate market? Although the idea of a short sale – a sale where the bank/lender takes less than the outstanding loan balance on the loan when selling a property – may sound like a good way to find a bargain, you may want to think again.

A good friend and colleague of mine, Angel Whitney of Countrywide Home Loans, sent me this great article from the Washington Post on the subject a few days ago and I thought I would share it with you: Short Sale Article . In a nutshell, very few Short Sales actually result in a successful closing. And, often times, the property might not actually be subject to a bank-authorized short sale to begin with.

Besides the reasons the Washington Post cites, in Washington State, we have a new distressed homeowner law that took effect on June 12th. Buyers of Short Sale properties should be very familiar with this law because you could land yourself in some seriously hot water if you are not careful. This goes for buyers who prefer to work on their own and buyers who work with a Realtor to purchase properties. Many real estate brokerages won’t even allow their agents to participate in these types of transactions any longer, fearing the legal repercussions of a botched deal.

Take a read through the article and the new Washington State law and think long and hard before you decide to be a Short Sale buyer or investor. There are tons of great buys out there right now and many, many sellers who are not in immediate distress that are willing to make a deal to sell in this turbulent market. Just be sure you don’t wait too long to act, though – with the recent passage of the housing bill we are already seeing a large increase in buyer activity; showings at our listings are going way up and reasonable offers are starting to come in again. It’s only a matter of time before our “buyers market” goes neutral and then tips back to the sellers again.

Take action – but do it wisely!

Happy Buying & Investing,

Tim