Miami foreclosure and Short sale properties are easy to buy - or is it?
Being a real estate broker in Miami
I get a lot of inquires about foreclosure properties in Miami and short sale condos in Florida, preforeclosure and foreclosure deals in Miami-Dade and Fort Lauderdale Broward counties. After trying a few short sales I realized that although it sounds easy and logical, the reality is it takes a long time and completing one of those deals is like winning a lottery.
Short sale sound like a quick
short and a straight forward transaction. The owners need to sell quick and the lenders are ready to accept less than the owners owe thus creating a great opportunity for a buyer. However, the only “short” aspect of these types of transactions is the “short fuse” which often goes off when the buyers are waiting and waiting and waiting for this deal to happen. To find out why this is happening we need to examine short sale process and understand the way banks think and operate when it comes to short sales.
Unlike foreclosure
where the bank assumes ownership, short sale is a process in which the owner, not the bank, is trying to sell their property. However, the owner will never get any proceeds from the sale, where in a case of a foreclosure, the owner may get whatever is left from the sale of the property if the amount is greater than what they owe to the bank. The bottom line is short sale has to be approved by the bank and, as you can guess, the procedure is very slow and cumbersome. The fact of the matter is the lenders are in no way obligated to approve a short sale transaction, nor they’re eager to complete it quickly.
So, after countless paper work that you need to submit including proof of funds, short sale application, an approval letter from your lender, letter explaining reasons for needing a short sale, comparative market analysis report explaining the value of homes in that area and much more, you find out that the property is not going to be approved for a short sale by the lender. This is because lenders in many instances are collecting on the Private Mortgage Insurance (PMI) and recover their losses from a foreclosure.
If you’re looking for a bargain
my suggestion is don’t try to do it the hard way. Use the tools available to you to on the Internet, do the research yourself, get knowledgeable, qualified Miami realtor and start negotiating. After all, free cheese is really free only in a mouse trap.
