Foreclosures and Short Sales are not always the best deals out there on homes in the northern Illinois area. What is a “short sale” or “bank owned” or “foreclosure” property?
A “Short Sale” is when a sellers loan exceeds what they would sell their home for in today’s market with all the fees. In other words they are “short” of funds to cover the sale. The seller has to have some sort of hardship. Either a seller or a hired real estate agent can negotiate with the lender once a contract is presented for the property. The lender prefers that an experienced real estate agent with short sales negotiates. The lender does pay for most fees including the Realtors commission. Short sale listed properties are generally sold for less than market value, partially because of the time and patience needed from the buyer and even if a home is listed at a certain price and the offer is presented to the bank, the bank may come back around closing time and renegotiate for a higher price, sometimes at more than a Realtors perspective of market price. This typically happens after months of waiting as prices continue to drop and the home is no longer worth the contract price, and then the lender wants more. Usually the buyer walks.
“Bank Owned” or “Foreclosed” properties are properties that have been foreclosed upon and are now owned by the bank. The bank in many cases hires a Realtor(REO agent) to list the property for sale. The houses are vacant and many have been fixed up to live-able condition. Many are at a low price, but when priced below market, there are generally multiple offers within days. There is less waiting on a bank owned property for contract acceptances and you can generally close a lot quicker.
In both cases,the homes are sold “as is”, the time required is not definite, you may be competing against multiple offers if the property is priced well, if the offer contains contingencies (attorneys, home inspection etc) it may be rejected, the price may be adjusted or negotiated. If these risks are acceptable to you, these may be good options for you.
Another option: A home that is for sale that has a motivated seller that realizes the market. There are many homes for sale in Northern Illinois that are priced really well right now. The sellers are motivated and there is so much less risk involved as far as condition, timing and aggravation on the buyers part. If you are searching for great home buys right now, don’t limit your search to Foreclosures and Short sales, use an experienced real estate agent that can sort your search for homes.
Our teamspecialized in listing and selling REO listings and Short Sales. In other words we help, buyers and sellers including the banks.
Posted By: Julie Anne – The Julie Anne Real Estate Team at Keller Williams Success Realty