What are the pitfalls of buying a short sale property?
• The short sale process may take several months to complete and it may be difficult to pin down a firm closing date until the seller’s mortgage lender agrees to the short sale. Junior-lien holders such as second mortgages, HELOC lenders and other special assessment liens may also need to approve the short sale. If a buyer is bound by a specific timetable to buy a home, the short sale may not be an ideal route. • There are many roadblocks which can derail a short sale. With extra research, a buyer should be able to uncover the possible obstacles and plan for them. • Buying the property on an “as is” basis. • The approving lender will rarely agree to pay for any extras that a regular seller would normally agree to. This could mean higher closing costs for the buyer. The buyer will need to shoulder those costs. (For example, the buyer covers the cost for inspections and repairs).
