For years people have heard stories of incredible deals to be had at foreclosure.  A typical foreclosure takes place at the county courthouse steps on the first Tuesday of each month.  A lender will auction of the property to the highest bidder.  This bidder will then have the pay cash that day for the property.  A property they probably haven't had an inspection on or probably even been inside.  In addition, there is no title policy or warranty on the title.  To say this is a leap of faith is an understatement.

A better way to get a "foreclosure deal" is a short sale.  These sales allow seller's to sell a property that would normally be foreclosed on due to a large negative equity balance.  For buyers it's an opportunity to purchase a property at a discount, while still having a chance to inspect the property.  The buyer also has the opportunity to obtain financing and receives a title policy at closing.

Ely Properties is proud to represent both buyers and sellers in these transactions. Call us at 512-476-1976 to learn more.

What is a Short Sale

A Short Sale is the sale of real estate  for less than the amount the seller owes the lender on the current mortgage.  The lender agrees to accept less than the full balance due on the property and usually forgives all or a large portion of the balance outstanding.

Closing Date

The final closing date is contingent upon the seller’s bank.  Typically shorts sales take 45 to 60 days from the day of execution.  As a buyer, please understand this delay, if you can not accept this delay please do not make an offer on the property.

The timeframe usually depends on the files status with the lender’s short sale process.  In many cases if final short sale approval has been granted, then the property can usually close in less than 30 days.  Since each property and lender is different, please contact the listing agent to determine where in the process the property is located.

Special Provisions

Paragraph 11 of the Texas Real Estate Resale contract must contain the following contingencies:

A.       Property is being sold AS IS.

B.       This contract is contingent upon final approval of seller’s lender.

C.       The Option Period will begin once the contract of sale is approved by the Seller’s lender and/or HUD

Option Fee

An Option Fee of $1 is acceptable.

Closing Costs

Lenders will usually pay typical and customary seller’s closing costs, such as a title policy, commission, ect.

On FHA Short Sale – Lenders will not pay any buyer closing costs or assistance programs.  You cannot increase the price to offset these costs.  Paragraphs 7H and 12 must be left blank.

On Conventional Short Sale – Lenders usually will not any buyer closing costs or assistance programs.

Survey

Lenders will not pay for a survey at the seller’s expense.  Paragraph 6, C-2 must be check.  We will try to obtain the Seller’s Survey.

HOA Transfer Fees

Typically a lender will accept a 50/50 split on HOA Transfer Fees.

Pre-Approval/Proof of Funds

Offers must include a pre-approval letter from the buyer’s lender.  Cash offers must include proof of funds.

Double Closings/Flips

We will not allow or participate in double closings or flipping of short sale.

Making an Offer

Typically if we receive an offer of at least 98% or more of the asking price we will mark the property PB in the MLS system.  We will work with the lender to try to get the offer accepted.  If the lender does not accept the offer and provides us with a minimum required amount you will have the first right of refusal to match that amount prior to us updating the MLS and accepting other offers.

Multiple Offers

We will only work with the lender on one offer or contract at a time. In the event we receive multiple offers on a property, we will counter for your best and final offer.  Our policy is to select and submit the best offer.

Utilities for Inspection

We request that the seller leave the utilities on during the sale.  But if some cases the property may be vacant and the utilities may have been turned off.  In these cases since the seller is in a hardship situation and cannot afford the deposits and connection fees to turn the utilities on, we request the buyer have them turned n for the inspection, once the contract has been approved by the lender.

For more information about a short sale contact us directly at 512-476-1976