All around the world, more and more people are making money in the real estate market with short sales. In instances where the owner of the property owes more than the actual current property value, the bank will often decide to do a short sale. The majority of the time, the property owner is no longer able to make the payments. If the property is not sold, it will be lost to foreclosure.
Not so long ago, banks were in a tizzy trying to figure out how to deal with short sales. These days, banks have gigantic departments in multiple locations that are set up with the sole purpose of dealing with short sales. The result is several banks becoming overwhelmed by the number of offers that they are receiving on this type of property investment.
Weighing Your Options
The majority of banks today have their own process in place to handle short sales. The process is followed closely to ensure that you are successful in closing the deal. Even after you have met all of the requirements, it may still take as long as three to nine months before your deal is officially approved. If you have the patience, the result could be a huge payoff.
On the contrary, the market continues to decline in various areas, which means that short sales may be no better that purchasing the investment property at current value. Typically, the first offer does not close the deal. More often, the third or fourth offer is successful.
You can make the process of learning the ropes of the real estate market easier by connecting with a mentor. The ideal mentor is someone who has been in the real estate investment business for a while and can offer you some sound advice. The best part about having a mentor is they will be able to tell you about some of the mistakes they made along the way, which will help you to know what to expect and avoid the same mistakes.
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Hi Sean,
Short sales seem like a tragedy to me. I don’t know that I could profit off someone’s troubles even if it’s a sound financial decision. I think there are a lot of other real estate investment options for me to capitalise on without going down this route.
I might need my mentor to help me get my head around this one.
I didn’t realise that you could access short sales in one location…cool. I have heard of this technique being used with council defaults also.
Distressed properties are quite often viewed by buyers as the glass half full whereas for sellers it is often the glass half empty. Therefore having resource to a well experienced mentor in real estate investment might well assist you in making decisions you will not regret.