Short Sales Are Long on Frustration!

We are often asked about homes that are in foreclosure or that are short sales.  The perception is that these are a great deal, a very low price, the bargain of the year! Sometimes they are, if we can just get them to close.

We have a lot of stories of contracts written, hopes of success, plans made and then nothing.  The banks string the listing agent along, the seller hopes to unload their house and their debt, the buyer spends time getting estimates for renovation and the months pass by...finally we hear something.  Usually it's that the second mortgage holder will not agree to the small amount of money that the first mortgage holder is willing to give them to sign off on their debt.  There are also a mountain of other problems.  The latest is that during the waiting game the seller died and the heirs are not willing to pay off the mortgage so the whole thing had to go through probate and eventually ended up at Fannie Mae.  There is a deep bottomless pit at Fannie Mae.  Loans go there for mortgage heaven and are never seen again.  So the house is about to start its third year of deterioration, ready to take on more water, freeze more pipes during the long cold winter while Fannie Mae and our tax dollars fly out the windows.

The perception is that this is a great way to acquire investment property, and we have had several success stories, but it is hard and never to be relied on.  And in the end, how do you know that you got a great deal?  Often we sell houses that are not in this depressing category and they turn out to be great deals too.  Not so abused, needing nothing like the kind of renovation that the average short sale or foreclosure entails, and in a normal deal you don't have to give up control of the closing.  Often with short sales and foreclosures, the bank involved requires that you sign their contract, close with their title company and buy title insurance from their insurance provider and won't give you any disclosures.

My advice is look carefully at every deal on the market in your price range, there may be a great deal masquerading as a normal listing!!!

Call The Meadows Team if you have any questions.  513.766.3888.

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