What is the difference between a Foreclosure and a Short Sale?
The reality is that there are big differences between a Short Sale and a Foreclosure and every buyer and seller of Central Florida needs to be aware of these.
1) In a short sale the bank does NOT own the Home or Condo, whereas in a foreclosure the bank is the owner of the property.
2) The time frame to purchase a Short Sale is much longer than a Foreclosure. In a condominium it can be even longer if there is past due maintenance owed to the condo association.
3) Usually the condition of Real Estate that has gone through the short sale process is far better than homes and condominiums that have been foreclosed on.
4) Sellers who may see Foreclosure down the road need to work aggressively with an experienced Short Sale agent to avoid Foreclosure.
In the Central Florida Real Estate market there are exceptions to every rule but let’s discuss these primary issues that distinguish foreclosures from short sales in the market we face today. When the bank owns the property, a foreclosure, they are motivated to sell. Once the bank places the property onto the MLS with a Realtor the average days on market are between 5-30 active status days. Often there is a bidding period where the most qualified buyer takes over the title of BUYER for such address. It’s important to have mentioned that most of the time these houses (foreclosed homes) are sold above asking price.
In a short sale, the bank does not own the home or condo, and the goal is to get an offer in front of the bank, that makes sense in the current real estate market. Depending on the bank the process can take up to 9 months to approved and finalize the short sale process. A Realtor that is well versed in the short sale market and has the necessary resources to surround your needs it’s the Realtor that will embrace a successful process.
We must remember that Short sale can be a failure and cause to face a foreclosure if factors like communication and cooperation are not meet. It takes a well funded team that includes you to succeed. The number of sellers seeking this type of debt relief where homes prices have fallen as much as 50% has caused many banks to be simply being overwhelmed with the process. This is why you need to get a well base and knowledgeable group of professionals like: http://sellmyhouseflorida.net/ Or http://www.housesbymaria.com/
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The last issue we mentioned above is condition. The foreclosure process can be long. The court system is processing more than they were ever equipped to handle. The uncertainty of the process forces many homeowners to leave their home and move on with their lives long before the foreclosure process is final. After all why would anyone want to witness the day they lose their home.
In the case of a Short sale it can be different. Many home owners stay in their home throughout the short sale process. The electric is on, the air conditioning is running, and the end result is a home or condo that has been cared for until closing day. In many cases this cared for home represents a better value to the buyer, who has had to be very patient throughout the long process.
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