Are you considering purchasing a Newport Beach short sale? If you are, then you will need to be prepared for some challenges that come up along the way. The definition of a short sale is the sale of real estate in which the amount yielded from the sale is short of the balance owed on a loan secured by the property which will be sold. In essence, what that means is the lienholder(s) agree to discount the balance of the loan to sell the property. This is usually done in lieu of foreclosure.
Often times, buyers will think that a Newport Beach short sale will be a better “deal” than an equity sale. And sometimes they are, however, keep in mind that the lien holders want fair market value. The lenders have their own systems in place to perform multiple BPO’s (broker price opinions) to establish value of the home, and often time they will have it appraised as well.
Once you have identified the property that you want to make an offer on, your Newport Beach realtor will write up a contract and along with the contract is a short sale addendum. This is submitted to the listing agent. The negotiation at this point is between the buyer and the seller of the home. After a price is agreed upon, and the contract is executed, the listing agent will submit the package to the lien holder for their approval. This process can be time-consuming.
Once the lender or lien holder approves the short sale (and keep in mind there can be multiple lien holders), typically there is a specific time frame that the due diligence be completed. What that means is that your loan will have to be approved, home inspection completed, termite inspection and repairs completed.
Another consideration is that the banks or lien holders may not pay for any repairs. You are buying property as is.
If I can answer any questions about short sales in Newport Beach, please contact me.
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