Is That Short Sale Really a Bargain?

Searching for a property these days provides many choices and some "bargains" can be tougher to obtain than others, especially short sales. 

A "short sale" is a property where the mortgage balance is greater than the market value currently. When these properties come to market they are usually listed at a price that the bank believes to be "Fair Market" value.

The condition of these homes is sometimes compromised and, as in some cases, the homeowner's are already moved out. Others will be in fairly decent shape. 

One of the potential problems is that there is no telling how long a negotiation with the lender will take. Why is this an issue? If you are looking to lock in an interest rate, it may be hard as they don't always conform to a normal lock in period and you may have to extend your commitment while you are waiting on the bank for approval. 

The next challenge is that there will be transfer taxes and other fees that will need to be addressed and the bank, being the "seller," may pass those fees over to the buyer. 

Lastly, the engineering report is for the buyer's information, meaning that any item that is not in working order might end up being the buyers responsibility! If you as a buyer will end up repairing many items, is the great value still there? This is the decision that you will have to make.