Posted by: Roby Robertson | November 16, 2009

Lake Norman – Why take that offer?

What if you have an offer to purchase your Lake Norman or Charlotte, NC area home? What if you really have to sell but the offer is not enough to cover all of your expenses?

Here is some great advice how to handle this Lake Norman transaction.

If you have a preapproved buyer who can definitely close the transaction, it would be very smart to take the offer, even if it’s less than what you need to pay off the loans and closing costs. There is a tremendous amount of commentary from the experts about a new wave of foreclosure properties entering the market in 2010. There could be well over a million properties. A flood of new inventory would have the effect of lowering prices even further.

The other concern is that our government is having trouble selling Treasurys. This lack of demand will probably force the government to raise the rate of return to attract buyers for our debt. When these costs increase, buyers experience them as an increase in the interest rates. When rates go up, the number of buyers who can afford your home decreases.

Thus, you could be facing the double whammy of more foreclosure properties competing with your property, plus a reduced buyer pool if interest rates increase.

If you have money in the bank and enough to purchase another property, a short sale where the lender takes a reduction in their payoff amount is probably not a viable option for you in terms of bridging this gap.  Besides, a very small percentage of short sales actually make it to closing and ultimately end up in foreclosure.

The good news!  When you go to buy your next Lake Norman area home:

An increase in inventory means that you may be able to get a much better home at a lesser price. Even if interest rates increase, however, many people will lower their price to move their property.

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