The president of the Massachusetts Association of Buyers Agents is warnings consumers that residential short sales - which occur when an "underwater" home is sold before it's foreclosed on - come with many complications and often times are not finalized. It is in your best interest to have your own real estate attorney when you are considering this type of sale.
The MABA President said that based on analysis he has done, between 30% and 50% of short sales in some communities do not close.
A short sale requires the lender or mortgage holder to accept less money in the sale of a property than what's due on the mortgage. Because lenders take a loss on the property, many are unwilling to negotiate short sales. A real estate attorney is in a much better position to negotiate with a lender than you are.
"There's this fantasy about short sales, because they appear to be good deals, but the reality is quite different and consumers need to beware of the challenges and difficulties associated with these transactions," MABA president Schneiderman said. A real estate attorney can negotiate for you, see if there are any issues with the title, or find any other potential problems with the short sale home.
If you do pursue a short sale, MABA recommends working with a registered buyer's agent and a real estate attorney, someone who is familiar with the fair market value of the homes.
Original article - Worcester Business Journal