Tips for Success in Purchasing a Grand Rapids, MI Home through a Short Sale!

Sifting through the facts...

Sifting through the facts...

Purchasing a new home is one of the most exciting experiences an individual or family can have.  If you’ve been out of the real estate market for some time, you may be unaware of some dramatic changes in the real estate market landscape. 

In today’s market, there are some unique situations which home buyers should be aware of as they prepare to consider the purchase of a new home.

GOOD NEW FIRST…

The good news is that home buyers in the Grand Rapids, Michigan area will find that they have a bountiful number of choices for a new home purchase.  Inventory levels of homes for sale are at historic levels. 

First time home buyers can also take advantage of some TAX FREE incentives to the tune of up to $7,500 dollars if a new home is purchased on or before July 1, 2009.

HOW THINGS HAVE CHANGED… 

However, home buyers looking for a home to purchase will also quickly become aware of a notation which currently accompanies almost 65% of the homes listed for sale in November 2008 through the Grand Rapids Multiple Listing Service.  This notation which is accessible to the real estate agent on the listing card, will indicate and advisory warning indicating that interested parties should be aware of the fact that the sale of the listed home will necessiate a ‘Short Sale’.

If you’re a brand new home buyer or recently re-entering the market, this notation may prove perplexing and you may wonder…What is a Short Sale?

SHORT SALES IN BRIEF…

Well, in short (pun intended)…A Short Sale notation on a listing card is an indication that the home is priced below the mortgage balance owed on the home. (after costs associated with the home sale are paid)

WHAT DOES THIS MEANS FOR YOU…

Well, it depends. 

On the most basic level, this means that in order to become the new owner of this home, you will have to complete a successful negotiation with the owner (s) of the mortgage note to purchase the home to allow the ownership to be transferred to you for less than the current owner owes.  This adds several  additional steps and required signatures to the offer acceptance process which will now include:  the home owner who signed the listing agreement, the lender (s) and in some cases third party investors.

FOR STARTERS…

But for starters, it means that you should be prepared to be very patient and persistent if you truly want this home.  Short Sales are arguably among the most difficult negotiations to complete.  It is not unusual for real estate agents to negotiate for months to bring these transactions to closure. 

Being prepared for the long haul will save you angst of increased blood pressure, stress and unnecessary temper tantrums. It will also be deeply appreciated by your real estate agent who will probably accure more stress than a commission will adequately compensate for.

BASIC STEPS…

Buying a home which requires the negotiation of a Short Sale will also add some additional steps to the home purchasing process.  Be prepared to wait while the bank (s) review the home owners paperwork to determine if they qualify for a Short Sale.  You can also anticipate that a Broker Price Opinion aka Appraisal may be ordered to determine if the bank wants to entertain your offer as one reflective of the current market conditions.

Offer submissions for Short Sales may languish on an Asset Managers desk while they sift through hundreds of files which have landed there before yours or wait to see if a better competing offer comes through.  Be persistent.  If you’ve done your homework and received professional consultation from your real estate expert, you should be aware of the Value of your purchase.  A Short Sale negotiation done correctly can earn you your dream home with a significant amount of equity attached…no small feat in today’s market.

HIRE A PROFESSIONAL…

Although it’s not possible to cover the complexities of the Short Sale process in this short post, you might find the links below helpful as a home buyer or home seller in the Greater Grand Rapids, MI area.  You can also contact us at info@auduhomesto discuss the particular details of your situation.  We specialize in advising clients on strategies to buy and sell property in a challenging market.

Click this link for 15 Additional Articles penned by Lola Audu or Audu Real Estate about the Grand Rapids, MI Short Sales Process.

Contact Audu Real Estate @ 616-791-0511 for a complete list of homes for Sale in Grand Rapids, Michigan.

Copyright 2008  Audu Real Estate  All Rights Reserved

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