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Considering buying a short sale home in Raleigh, NC?

What is a short sale? What are the advantages, if any, are there for a home buyer?

First of all, let’s consider how a short sale is defined here in Raleigh, NC.

A short sale indicates a real estate sale where there is more debt owed on the property than the property is worth. This is a home sale where the amount of the sale price is less than amount owed to all those who have an interest in the property, with lender or lenders accepting the sale proceeds as payment in full. The home seller thus needs the lender(s) and all lien holders to accept a payment that is less than the amount that is owed. There may be other parties that have to approve the home sale as well. These include those who insured the loans (like PMI), bankruptcy trustees, and taxing authorities.

According to the North Carolina Association of REALTORS® standard form 104 that is used along with the offer to purchase a short sale is where:
· The purchase price is or may be insufficient to enable Seller to pay the costs of sale, which include but are not limited to the Seller’s closing costs and payment in full of all loans or debts secured by deeds of trust on the Property due and owing to one or more lender(s) and/or other lienholders
· Seller does not have sufficient liquid assets to pay any deficiencies and
· The Lienholders agree to release or discharge their liens upon payment of an amount less than the amount owed, with or without the Seller being released from any further liability.
* STANDARD FORM 104 Revised 11/2010 ©2011
The obvious advantage to a home buyer in regards to the purchase of a short sale is the possibility of getting a significantly reduced price and this does happen. However, the timeline for the home purchase is anything but short. The short sale purchase is also significantly more complex than the standard home purchase.
Another advantage to the buyer is that often due diligence fees are lower and earnest money deposits are often not required until the lenders have approved the transaction.

We highly recommend that you have buyer representation in the process. The lenders usually do pay the buyer’s agent fee. Still interested? Give us a call today.

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