Posted by: Roby Robertson | December 19, 2007

Lake Norman Real Estate;When a short sale isn’t a short sale

Real estate agents are complaining that some homes marketed as short-sale properties are not actually short sales. In a short sale, the lender signs off on a real estate transaction in which the sale proceeds fall short of what the owner owes for the mortgage.

A decline in the home’s value since the date of purchase, or a seller falling behind on mortgage payments do not automatically qualify a home as a short sale. There can be no short sale without the lender’s approval, as the lender must consider whether it is worthwhile to accept less than the full loan amount in order to avoid a foreclosure.

What is there to gain by marketing a property as a short sale that isn’t a short sale? Serious buyers are a rare breed in some market areas these days, and many of them are looking for bargains. Short sales can in some cases sell for a lower amount than comparable properties that are not similarly distressed, as there is urgency by sellers to get out from under the properties and by lenders that wish to avoid costs associated with foreclosure.

So just like those furniture stores that seem to perpetually advertise a going-out-of-business-everything-must-go-including-the-plastic covers-on-our-electrical outlets-final-ultimate-last-possible-ever-chance-to-buy-cheap-stuff-from-us sale, dangling the “short sale” term in marketing a property may be an effort to attract bargain-basement shoppers.

If your in the market for forclosures or short sale homes in the Lake Norman and Charlotte areas, call your Lake Norman Agent at 704 451 7051 today for more information.

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