What is a short sale? Sometimes on the multiple listing states the property is a short sale, but it need not state this. A short sale occurs when the current market value of the property is not sufficient to pay all debts and obligations secured by liens on the property. A short sale requires the seller to enter into short sale agreements with each creditor who has a lien against the property. The short sale is the most complicated of all the bank sale types. The seller most likely still is living in the property. The property is usually being well kept. The problem is that the bank has not taken steps towards agreeing to sell the house for less than the mortgage amount. They do not start those steps until a purchase agreement is received by them. The purchase agreement must state within it that the agreement is contingent on the bank accepting the terms of a short sale. If there are several lien holders, you will usually find the first lien holder is easy to work with (they have the best chance of getting their money back) and the lien holders that follow are more difficult as they are not likely to see their money back. In fact those further down the line many times force the property into foreclosure. To a buyer this means you can wait 60-90 days before you hear from the lien holders as to the acceptance of the offer. Sort sales can be a great opportunity for a buyer to buy a property in fairly good condition at a lower price. The buyer does need to patient to hear if their offer is accepted and they must buy the house in "as is condition" without any warranties.
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