Traditional sales are by far the most common type of home sale. That doesn’t mean you shouldn’t know about the benefits of short sales and foreclosures, however.
I get questions all the time about traditional sales, foreclosure sales, and short sales. A lot of buyers are under the impression that they each follow a similar script, but that’s not true at all. Each type of sale is different and has its own set of advantages and disadvantages. Here’s what sets each type of sale apart.
A traditional sale is by far the most common and widely experienced type of home sale. It’s a transaction between whoever owns the house and you. The bank isn’t involved here because the homeowner has enough equity in their property to make the sale, pay off the existing mortgage, and move on. A traditional sale is strictly between you and the home seller.
When a homeowner owes more on their mortgage than what the home is currently worth, they can attempt a short sale. This is where they approach the bank with an offer on their home and ask them what they think. If the bank thinks the price is acceptable, they will proceed with the short sale. They might counter back or straight up reject the offer, however. This is a difficult kind of sale to pull off, but not impossible. The big problem is that it can take at least six months in most cases.
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With foreclosures, the bank has already taken possession of a home and is looking to get rid of the property quickly and for as much money as possible. You’ll have to negotiate directly with the bank to purchase a foreclosure. This is another type of sale that takes a bit of time to go through.
Each type of sale is different.
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As a buyer, you can get a great deal on a short sale or foreclosure home. However, you might have to wait six months or more to get into that home. A traditional sale is much easier and faster, but you’ll have to pay market value for the home.
If you have any questions about any of these kinds of home sales, don’t hesitate to give me a call or send me an email. I look forward to hearing from you.
