Whether you’re buying your first home or you are a seasoned real estate investor, finding a property at a great price is exciting. However, navigating a short sale transaction can be time consuming and stressful, especially if you are new to it. A real estate lawyer in PA can help you understand your rights, protect your interests, and assist you throughout the process.
What Is a Short Sale?
Typically, a short sale happens when a property is sold at a price that is less than what the current owner owes on their mortgage. It can be an option when a homeowner has fallen behind on payments and is trying to avoid foreclosure. In a short sale transaction, you negotiate with the mortgage lender, which is much different from dealing with a real estate agent or homeowner. Buying a short-sale property can be risky, so finding a firm that offers real estate lawyer services can help to ensure you have a staunch advocate looking out for you throughout the process.
Short Sales can Be Tricky
Buying a short-sale property involves much more than negotiating and coming to an agreeable price. Before the process begins, the mortgage lender must approve the short sale. The process can take many months or even more than a year, which requires a lot of patience. Unlike foreclosure, the owner can stay in the home during the short sale process.
If the bank decides that foreclosure is a more lucrative option, they may reject the short sale and move ahead with foreclosure instead. A lawyer for real estate can also help you purchase a property in foreclosure, but the process is different.
Why Hire a Real Estate Lawyer?
In addition to helping you negotiate the price and conditions of the deal, a real estate attorney can help you handle any pitfalls that may arise. If there are multiple mortgages or liens on the property, all lienholders may be involved in negotiations because their permission is needed for the sale. If the primary mortgage lender is unwilling to agree to a satisfactory portion being paid on junior liens like home equity loans, these lienholders may refuse the sale and allow a foreclosure to proceed.
The advertised price may not be anywhere near the final purchase price. Lenders often list short sales at a low price to rouse interest. When the real estate market is strong, lenders will want more money. It can be difficult to secure financing for a short-sale property, and you may also have to pay all closing costs. Short-sale homes are also sold as-is, which means price concessions for repairs are usually not on the table.
Understanding the details and nuances of a short sale is challenging. That is why it is essential to have a seasoned attorney review any proposals or contracts and assist you with negotiations. Our West Chester real estate lawyers have extensive experience handling all types of property transactions. We can help you understand the pros and cons of buying a short sale and advise you of your options.