This article should help answer questions surrounding short sales and serve as a helpful guide on how to buy an Atlanta short sale home.

First the basics:

1.  What is a short sale? In real estate, a short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a loan secured by the property sold. In a short sale, the bank or mortgage lender agrees to discount a loan balance due to an economic or financial hardship on the part of the mortgagor.

2.  How does a seller benefit? A short sale allows the homeowner to avoid foreclosure.  The benefit of this is that it has less negative impact on the individuals credit and provides the homeowner a chance to rebuild and move forward with their life.  Another benefit that is often overlooked is that the individual is actually residing in their home mortgage free while the short sale is being negotiated.

How to Approach a Short Sale Listing agent:

Below are a few questions that you should ask the short sale listing agent:

1. Have you submitted a purchase offer to the bank? If the answer to this question is yes, you should dig a little deeper with your questions.  Get as much information from the listing agent as possible to help you determine what type of competition you are facing.

2. Have the homeowners applied for a loan modification? If the answer is yes, has a broker price option (BPO) been done?  When was the date of the last BPO?  If the BPO was done within the last 6 months are you able to get the BPO price?

3. Is the listing agent handling the short sale negotiations or are they outsourcing negotiations to a third party? If the listing agent is not the point of contact and is unwilling to be the point of contact you may want to skip this one as it may be more trouble than its worth.

How to write the purchase offer:

Write a “clean” offer.  Make it simple for the bank to take a look at your offer and either approve or disapprove it.  The fact that it is a short sale means you can go in with a low offer, but try not to be greedy and ask for much else…this will be frowned upon.

Go in with your best offer first because should it become a multiple offer situation you will want to feel confident and not regret anything about the offer.

What happens next?

You wait.  And wait.  And wait.  Often times it takes several weeks before you will hear anything back from the banks.  Don’t get discouraged if you haven’t heard back, it will just take some time until you do hear something.

Knowing that you put forth your best offer to begin with though means that should you get denied you will have no regrets, but if your offer is accepted you will be over joyed and not think you over-paid either.