Sales Options

Types of Sales:

As we all know, the Real Estate Market has changed and it can get a little confusing out there, so here are some tips on what you can expect as a Buyer/Investor on the different types of sales that we will encounter.

  1. Owner Sales-These are just good old’ fashioned sales in which the owner has positive equity in the property and wants to sell his/her home.  In this type of sale we can expect a quick response to our offer and minimum amount of paperwork to be signed.  These properties are usually going to be a little higher priced than REO’s and short-sales but are for the most part a hassle-free transaction (no bidding wars or jumping through hoops) and the property itself will require a minimum amount of work/rehab.
  1. REO’s-This stands for Real Estate Owned, meaning a property which has gone through the full foreclosure process and now belongs to the bank.  Here we will find the best deals as far as price, but they don’t come without headaches.  Due to the low prices, bidding over asking price is common and usually results in a bidding war.  Also, many owners take their frustrations with the bank out on the house, so repairs will have to be done after closing.  Although REO’s are a bit tricky to navigate, most investors feel its well worth it due to the price discounts.  Offer response usually takes 3 to 7 business days and closings are as quick as possible.  Banks usually have their own addendums to the standard Real Estate contract that you will have to sign.
  1. Short-Sales- A Short Sale is the sale of Real Estate in which the proceeds from selling the property will fall short of the balance of debts secured by liens against the property and the property owner cannot afford to repay the liens’ full amounts, whereby the lien holders agree to release their lien on the real estate and accept less than the amount owed on the debt.  On a short-sale, the seller will sign off on your offer and then present it to the bank that holds the mortgage and they have the final say on the approval of the offer.  This process can take anywhere from 30 days to 12 months in some cases, and if the bank declines your offer we are back to square one.  Offers are made according to comparable sales in the neighborhood, and once accepted by the current owner must be approved by the bank that holds the mortgage.  These homes are usually in good shape since the owner is still living there and maintaining it.