Purchasing Short Sales

FOR IMMEDIATE RELEASE
Miami, Florida, United States of America (Free-Press-Release.com) August 8, 2011 -- Short sales can be a good opportunity for buyers to get a great deal, since they are usually priced below the market values. However, acquiring those properties is often complicated and requires patience and the help of an experienced agent or attorney to guide the buyer throughout the entire process.

Although short sales don’t belong to the bank, they have to be approved by the bank. And buyers may wait a very long time to get their response. In some cases, short sales get approval within six to eight weeks, while others can take 90 to 120 days.

Some buyers may get frustrated with the waiting for the approval and can even threaten to cancel the deal. This attitude, notwithstanding, will not speed up the process. Therefore, short sales are not recommended for impatient buyers.

Typically, the bank process works as follows:

• The bank acknowledges receipt of the file, which can take from 10 days to a month.
• A negotiator is assigned. This can take 30 to 60 days.
• A Broker Price Opinion (BPO) is ordered. The bank probably will refuse to share the results of the BPO.
• A second negotiator may be assigned. This can take another 30 days.
• The file is sent for review or to the Pooling Service Agreement (PSA), which can take 2 weeks to 30 days.

• The bank may then request that all parties sign an Arm’s Length Affidavit (a document to prevent sellers from selling to a relative and to curb mortgage fraud).
• The bank issues a short sale approval letter.

The purchase contract will specify that the terms are subject to the mortgage lender’s approval. It should also state the conditions of the property to be purchased. It’s also advisable that the attorney or agent responsible for the transaction includes a term in the contract that allows the buyer to back out of the deal in case the property is not up to inspection standards.

Because of the intricacy of short sales, potential buyers should always have experienced legal counsel during the transactions process to ensure a successful closing. It’s imperative that the buyer understands the factors to make the short sale profitable and enjoyable.

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