Ten Steps to Buying Your Wilmington, DE Short Sale!
In a housing market where many are having trouble obtaining the financing that they need for a home, short sales are a desirable option. The trouble is that many people have a view of short sales that is less than favorable. They believe that the property will be in bad condition or that the process to close the sale will take far too long. As a Wilmington, DE real estate agent who specializes in short sales, I think it’s important to say that while these two things can be true on occasion, the majority of short sale transactions can actually go smoothly, and that not all short sale properties are in bad condition.
There are a few tricks of the trade that I have picked up in my many years of working in Wilmington, DE short sales that I thought I’d share with you! If you follow these ten steps closely, you can close your short sale quickly and with little stress involved. Just remember one thing: in every real estate transaction, patience is important, so trust your Wilmington, DE real estate agent to guide you and get the job done.
1. Search for short sales in your area! There are plenty of short sales available in the Wilmington, DE area, so use an online database, courthouse listing or legal ads to locate properties that you may be interested in and let your agents know which ones you would like to look at!
2. Take a look at the property. Pictures and ad copy can be misleading, so it’s incredibly important to see the property for yourself before you decide to purchase a short sale. Is the house in decent condition? Will it need major work, or just a few minor repairs? If you’re in a position where you want to buy the property in order to fix it up and put it back on the market, then a house that needs work won’t be a problem. If you’re looking for something more move-in ready, however, then you may need to move on.
3. Do your research and run the numbers. How profitable will this Wilmington, DE short sale be in the long run? Even if you’re a first-time homebuyer who is looking to live in the home, there is a chance that you may want to put this property on the market one day. Is there potential for its value to go up? What is the property worth now? These are all questions that you should ask yourself before making an offer.
4. Find all liens and mortgages. You need to ask the seller or their agent what liens are on the property and who the primary lien holder is.
5. Figure out your financing. Now it gets a little tricky. You need to figure out how you are going to pay for the property. Are you going to be a cash buyer or ask the existing lender to give you a loan? If you’re a good credit risk, the latter may be a great option, and it will expedite the financing process. In order to close a short sale, you need to move quickly, so this stage is not the time to start shopping around for a mortgage.
6. Contact the lender. Either you or your Wilmington, DE real estate agent needs to contact the loss mitigation department of the existing lender and discuss the situation on the property’s current mortgage. Before doing so, get the existing owners to sign an authorization letter stating that you are allowed to contact the lender to sort this out.
7. Complete the lender’s short sale application, if needed.
8. Assemble the proposal. This is where your Wilmington, DE short sale agent will come in handy! Besides the application and authorization letter, you will need several more documents that the lender will use to review your offer. You need the purchase and sale contract between you and the seller, stating that you agreed on a price. You will also need a letter of hardship proving that the homeowner can’t pay what’s due, a statement of the property’s value, a detailed explanation of all of the costs and liabilities and a settlement statement put together by a closing agent. Have everything lined up before submitting anything to the lender.
9. Negotiate. It’s really not uncommon to go back and forth with the lender. They will likely counteroffer your initial, proposed price. Figure out what your highest limit is beforehand and stick to it. If the lender won’t meet your figure, it may be time to walk away.
10. Seal the deal. Once you’ve reached an agreement that you, the seller and the lender all approve of, then it’s time to close and claim your new piece of property!
The process might seem long and drawn-out, but if you go into your Wilmington, DE short sale transaction prepared, then you will find yourself a property owner sooner rather than later. As a Wilmington, DE real estate agent who specializes in short sales, I feel that it’s important to prepare my clients for the process ahead in order to ensure success in their transaction. Hopefully, by breaking down the process a bit, you will see that these transactions are manageable, provided that you have the right real estate agent to help you through it.
If you have any questions about Wilmington, DE short sales, don’t hesitate to contact me! I hope to hear from you soon.
Katina Geralis
Wilmington, DE Real Estate Expert
Keller Williams Realty
Wilmington Real Estate
Wilmington Homes for Sale
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