House Hunters Minnesota’s own Erica Quamme is a short sale expert. With multiple short sales (and foreclosures) under her belt she has a strong understanding of what is involved with real estate short sales in Minnesota. Below you will find questions and answers about short sale homes for sale.
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Q: What does a short sale mean?
A: The owners and the bank are selling a house short of what is owed on it. It happens before the foreclosure process.
Q: Why do short sales happen?
A: Owners are trying to save their credit status by avoiding foreclosure.
Q: Why would someone want to buy a short sale home?
A: To buy a home at a discounted price, but generally repairs will have to be made. You can get a great deal, but the homes sell as is.
Q: I heard short sales take a long time? How long is the process?
A: The process may take up to a year to finalize. Typically a short sale will last between 4-6 months.
Q: Why does it take so long?
A: After an offer is made,most of the time is waiting on bank approval. When a short sale home has an offer, the online listing will say contingent on third party approval. Additionally, there can be multiple offers, however the listing agent will present the first offer and keep the others as backup offers.
Q: Are there any reasons why someone should avoid a short sale?
A: On top of a long time for closing, sometimes short sales eliminates FHA, VA and USDA buyers because of the repairs needed for appraisal. Often sellers/bank will not contribute seller paid closing costs. Also bank addendums will shorten the inspection period or require more money down.
Q: How are short sales priced?
A: The listing agent gives a price on the home and they wait for offers to come in. Then the bank hires other brokers to do a BPO (Broker Price Opinion). It’s possible after the BPO is given, the bank will counter offer with a new price. Or they will accept your offer or give you the option to accept the new BPO price if the initial price was changed. It’s important to have a great Realtor to negotiate for you.
If you are interested in buying a short sale home in the Twin Cities area, contact Erica with House Hunters Minnesota. She will be happy to find you a home that fits your needs and expertly navigate you through the short sale process.