Simple guide to success with Short sale Houston
The process of short sale Houston happens when a house gets sold in the market for less than the outstanding mortgage amount. For example, imagine a person buying a home for a certain amount, say, $400,000. After a few months, the owner loses his job and falls back on his mortgage payments. He can decide to short sale the property rather than choosing the government offered refinancing options.
This is not the only reason that leads to a short sale. It could be divorce, job transfer, and inability to work anymore due to permanent injury and so on. But in such cases, the value of the property will go down, and there will be buyers willing to buy short sale properties. The banks use these properties for recovering the money. But they still need to give permission to the seller because the property in question will be sold for less than what it is worth.
Here are some simple tips to follow when you are on short sale Houston
Check the public records
First priority goes to do research before venturing to buy short sale properties. It is not necessary to know who owns the property, but you can always find out who owns the title, the amount due to the bank and whether a foreclosure had been filed or not. It is also important to know whether the seller has two loans because, both lenders have to agree to the short sale.
Sellers have to give hardship letter to the lender
It is important for the seller to give hardship letter to the lender. A hardship letter is an official letter that you submit to your lender, stating the reasons why you cannot pay the debt.
A Realtor with short sale Houston experience
Your aim of buying a short sale property would move much faster when you have an experienced realtor guiding you. After all, you cannot afford to miss a deal because the agent was inexperienced and forgot to follow-up. Follow-up is very important in such deals.
Having a deal with the lender
Once you put in an offer, the seller has to accept it, and then the listing agent would forward it to the lender. The deal will progress only when the lender accepts it. In certain cases, the lender might want to see proof of your funds and a copy of money deposits.
The lender might need to respond
The ball is now in the lender’s court. But you can give the lender a time-frame in which to take a decision. If the lender doesn’t accept by then, you are free to cancel the decision. Buyers usually do not contact the lender directly, so you will have to wait it out during the time-frame.
Seller paying commissions
Even if the seller is not getting any money out of the short sale, he still has to pay the commission. The lender will be actively involved in this and will communicate with the listing agent.
Conclusion
Short-sales are lengthy, and you have plenty of paperwork involved in it. But it is the perfect investment option for people looking to make money in real estate.