Short Sale and Foreclosure Buyer Options
Oviedo short sales can be a great opportunity for buyers to get a great price and value on a property. Some homes may be more distressed physically than others, but they’re still offered at great rates.
Oviedo foreclosures and short sales no longer make up a large portion of residential sales in today’s market; however, they are part of the options available to buyers. When buyers are searching distressed Oviedo properties, they learn fast that while these homes are priced below regular homes’ market value. For some, the time and effort to make it worthwhile may not be worth the price, while others may see it as a great investment.
Many want to know which properties they should pursue for a better investment: short sales or foreclosures. That really depends on the buyer and the priorities for purchasing the property. There are benefits and drawbacks for each one.
One of the obvious benefits of purchasing a foreclosure or short sale in Oviedo or any other city is the price. Typically buyer’s receive a largely discounted price on a distressed property. The immediate drawback many have is the need for repairs and replacements that can potentially be minor or major costs. Investors can typically expect to pay between 5-10% of the purchase price to renovate their distressed property.
The buying process for Oviedo short sales can be a lengthy process and many times include a “Short Sale Expert” that mediates the transaction with the Lender and Buyer. This may include fees charged to the buyer upon closing. In a short sale, the Lender has the final say in approving the offer, as they are the ones incurring the financial loss from the original loan amount.
Oviedo foreclosures can close within 30-45 days after approval from the bank, based on the buyer’s financing. Foreclosures have a larger incentive because they average lower sales prices than short sales and can close much faster.
If you choose to pursue the sale of a short sale or foreclosure, proceed with caution and make sure you can afford the repairs for renovating the distressed property. You can avoid these pitfalls through thorough inspections of the property.
What is a short sale and foreclosure?
A short sale is “a negotiated settlement between the lender and the borrower, and the lender cannot do anything to violate such an agreement.” This occurs when a borrower (owner of home) is no longer able to maintain the payments on the mortgage. They stop making payments and their mortgage goes into default. The bank, then, tries to sell the property to recoup some of the losses. They usually lose a large sum of their investment in the property leaving a seller with a deficiency.
A foreclosure occurs when the short sale has been unsuccessful and the bank has repossessed the property. At that time, the bank lists the property for sale without the previous homeowners involvement. The cost of these properties is usually affordable due to the condition of the home. Many repairs are usually needed to bring the home to livable condition, but these properties can make great investment homes or even primary residences.