Short Sale, Foreclosure, Bank Repo?

You hear these three terms all the time but what do they mean to you as a buyer? First, brief definitions and then what they mean to buyers.

Short Sale - When a property is sold for less than the mortgage and the lender agrees to accept a discounted payoff.

Foreclosure - The process by which the lien holder (the bank) retakes the tile to the property.

Bank Repo - When the foreclosure process is complete and the bank owns the property.

Ok, you know what these terms mean, but how do they affect you the buyer? I summarized what I have experienced in the table below.

   Short Sale  Foreclosure Bank Repo
Typical time from offer to acceptance
12 weeks to Never
1 to 2 weeks
3 to 5 days
Typical time from offer acceptance to close
30 to 60 days
30 to 60 days
30 to 45 days
Probability of the sale closing after offer acceptance
Fair
Excellent
Excellent
Negotiability
Fair
Good
Good
Typical property condition
Usually good
Fair
Fair to Poor

Short sales are the most difficult and frustrating to deal with. For example, I submitted an offer and finally received a response after about 6 weeks. What we received was a counter offer. My client responded with an offer very close to the counter (only the closing date changed). After another 4 weeks the bank responded that they would foreclose on the property and not sell it via. the short sale. I have other similar experiences on short sales; none of them good. See this page for more details and examples of short sale challenges.

If you are considering purchasing property in Las Vegas, call me. You will be glad you did..

Eric Fernwood
702-358-8884
Eric@ISellLVHomes.com