A short sale usually occurs when a homeowner can't make their loan payments due to some type of hardship. In addition many borrowers took advantage of 97%, 100% and in some cases 103% financing options. Some of these programs began with low introduction start rates and they recast to a much higher rate in 2, 3, 5 or 7 years.

In an appreciating market owners usually sell their homes for an amount that will pay off the lender. With a slight downward shift in home prices and little or no money down the homeowner now owes more than the property is worth or in other words they have negative equity in their home.

Faced with owing more than the house is worth and usually having trouble making mortgage payments for various reasons they have no option but to sell their home.

We assist the homeowner to negotiate with the bank so they may sell their home for less than what is owed on the mortgage. This process is called a short sale.

One of the most important aspects of a real estate short sale is the length of time the process can take. If you plan on buying a real estate short sale and you have a specific time frame you need to buy a house in a short sale may not be for you. Patience is a virtue.

Short sales take much longer than a “normal” sale; recently a short sale was approved in a record 15 days. That is the exception and an approval can take months and months. Often there a two mortgages on the property. The best case scenario is if they are both with the same lender however if there are two different lenders, we will need two approvals and that could take even more time. Lenders are overwhelmed with short sale requests, for example we spoke to one negotiator who had 450 short sale files on his desk. Please remember: Patience is a virtue.

As we know price is the big attraction for a short sale and usually the property is sold in as in condition. The present owner is financially and emotionally drained, for them to make a repair is next to impossible. Please remember: Patience is a virtue.

By now you may be wondering why we keep repeating the phrase “Patience is a virtue”.

In the excitement of purchasing a discounted property many times buyers forget that they have been forewarned that short sales are a long process. Remember the short sale lender does not take into consideration that the buyer and the seller are in a hurry to close the transaction. Once the offer is made the buyer often turns up the heat with repeated phone calls to the real estate agent looking to for answers. Our online tracking system for short sales will alleviate a lot of stress for the buyer. With the seller's permission the buyer will be able to access our website to view the progress on the transaction.

Even though the home owner agrees upon a price in the sales contract, the short sale lender will make the final decision on price. The short sale lenders, investors and insurance company’s need to ensure they receive the best return on their investment. A short sale usually means instant equity so if you are prepared to wait it could pay off.