Are Fort Myers Short Sale purchases and sales possible? Of Course! Our office has participated in many purchases and sales of this type of transaction. This purpose of this article is to explain the short sale process from a local level and to help you determine if a short sale transaction is right for you, whether you are a Seller or a Buyer.
When the housing market started to crash, the amount of short sale listings were rising rapidly. In 2008, 2009, and 2010 the short sale process gradually improved. In 2011, many banks have developed a “system” to handle short sale requests. It has been reported in national and local news that short sales will be the preferred method for banks to handle distressed property.
A Seller will need to sell their home as a short sale if they owe more than what the selling price will be. If a Seller owes $200K on their mortgage, and can sell the home for $150K, there is a $50,000 shortage. The Seller is short even more funds, as there are closing costs and commissions that need to paid. Sometimes there are back taxes, HOA fees, and city fees that will need to be paid, too. A Seller should consider a short sale if one must sell their home due to financial hardship, health issues, job relocation, etc. A short sale is alternative to foreclosure. There are incentives a Seller may receive for completing a short sale. A Seller must meet certain requirements to receive incentives. Most importantly, it must be the Seller’s primary residence. Some banks offer up to $20,000 to help with relocation costs. If one qualifies for The HAFA program, they may receive $3,000 at closing. There are many different lenders and each lender has its own process and standards for the short sale process. A Seller does not need to hire a lawyer or a company to help them complete a short sale. Laws are in place that will allow REALTORS® to assist a Seller with the short sale process. Not all Real Estate agents want to service a short sale listing and some do not even know how to complete a short sale. It is important that you look for an agent who understands the process. Your first step is to find someone to help you with the process. The second step would be to determine the value of your home. This is sometimes very painful. Many Seller’s will balk at the suggested list price that their Agent recommends. Even though they are in a short sale situation, Seller’s still think their home is worth more than what it is!
What are the tips for Sellers to complete a successful Short Sale in Fort Myers?
The most important element of a short sale is Pricing. If you price the home too high, you will waste valuable time. If you price it too low, the bank will reject your offer and you wasted valuable time. Pricing is a key element of a successful short sale. Your agent will have a short sale package for you to fill out. This will include an authorization letter for you to sign that gives your agent the right to speak to your Lender(s). It will also include important financial forms. Filling out the package and returning to your agent in a timely matter is also very important! Lenders will not accept “piece” submissions. They want all the forms from the Seller and the Broker, at one time. After you have chosen an agent, priced your home correctly, filled out the proper forms, returned all forms to your agent, you are ready to market your home. Being able to show your home quickly and on short notice helps immensely. Asking for a 24 hour notice to show your home, slows the process. Buyers are not interested in begging for a showing. If they can’t get in that day, normally it goes off their list. Once you receive an offer and it is acceptable to you, the offer is submitted to the bank. The bank will require proof of funds from the Buyers. The bank will also need a HUD, and other forms. Your agent should know what to do! It can take up 6 months on average to get an approval on a short sale. If you have a good agent, you can usually cut the time significantly. An agent who only submits a file to the lender and does not follow-up regularly is wasting time.
Once you get an approval letter from your Lender, you should have your accountant or attorney review the letter. If it is acceptable to you, you are now on your way to closing the transaction. The Approval letter is a key element in the transaction. If you have questions about the short sale process, feel free to email me direct at megan.floridawestshore@gmail.com I would be glad to give you a free opinion.
Who should buy a short sale?
If a Buyer has time and is willing to take a chance, they should consider a short sale. Be prepared that you may never close on the home. However, if you are willing to wait out the process, you may make a lucrative purchase. If you hire an agent who is well versed in short sales, they should be able to zone in on the cues that the short sale is going nowhere and guide you to another home. Be sure you are pre approved or provide your agent with proof of cash to close the transaction, as this is required for the lender to consider your offer. Once you get notice that your purchase has been approved by the Seller’s lender(s), your inspection and contract obligations “kick in”. Buyers should know that they may have to wait for months for a Short Sale approval, then all of a sudden, they get the approval letter that gives them only 10 days to close! (This happens more frequently if it is a cash purchase) It is usually a rush scenario, so be prepared.
If you would like to buy or sell a short sale in the Fort Myers area, please call me, Megan Eister, at (239) 707-0926. I would be happy to help you. I have been a Broker since 1993 and I am a former mortgage banker. I would be happy to assist you with the short sale process in Fort Myers, Florida. Please check out the Fort Myers Short Sales by clicking the link below, or visit my website for other areas (Bonita Springs, Estero, Cape Coral) at www.floridawestshorerealty.com
VIEW ALL FORT MYERS SHORT SALES
