Many thought that Hoboken was immune to the growing foreclosure market but unfortunately that is not true. As I mentioned in my April 7th posting of final Hoboken sales numbers for March, there were 3 short sale properties under contract (since January) and there are another 8 available - possibly more. Nationally, it is estimated that 1 out of every 10 homeowner, is in some stage of mortgage default and this number is growing. * Source Housingwire.com article prime arms set tone for troubled mortgages
However, I want you to know that although a short sale may seem like a wonderful opportunity (and they can be for buyers), their are some things you should know before investing time and money into one of these.
1. Just because a property is listed and advertised as a short sale that does not mean that it will be approved.
-- Short sales have a list of requirements before they can be approved with the bank and requires detailed information and research before submitting. Unfortunately many real estate agents are marketing these properties without knowing what's involved. In some cases an agent will occasionally get lucky and make it to a closing table, unfortunately in many cases they wont. In fact, it is estimated that for every 10 short sales listed with real estate agents that are not certified only 1 will close. I will come back to this point.
2. A short sale property means that the homeowner is in some type of financial distress, and this is a requirement for a successful short sale.
--Some people have a misconception that the seller is making money on the sale. This is false, and in fact the seller can not net any money at the sale.
3. An accepted offer or even a contract on a short sale does not guarantee a sale.
--In the end, the lenders involved will have the final say on approving the sale. So it is important to know that you can end up being out of pocket and end up without buying a home.
It is important and almost crucial to the success of your sale or purchase, that you work with a certified distressed property expert(CDPE), or at the very least someone who has had experience with short sales and is knowledgeable with the process, pitfalls, risks and benefits.
Short sales can be a saving grace for homeowners in financial trouble. A foreclosure is bad for everyone involved, the homeowner, the lender, immediate family, and a community in which the foreclosure is located. It can reset home values very quickly, and while short sales will also affect property values, they will do so at a much higher percentage than a foreclosure.
If you'd like more information, or know someone that needs help please do not hesitate to contact me.
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