Buying a Home Through a Short Sale: Understanding the Risks and Benefits

 Posted on March 07,2023 in Residential Real Estate

Inflation, unemployment, illness, and countless other factors can make it difficult for homeowners to make ends meet. Consequently, some owners end up selling their homes for less than the amount that is still due on their mortgage. This is referred to as a "short sale."

For homebuyers, a short sale can present a valuable opportunity. However, buying property through a short sale is not without risk.

Possible Advantages and Disadvantages of Buying a Home Through a Short Sale

The main reason that someone would consider buying a short-sale home is that it will likely be available for much less than the home's appraised value. This means that the buyer could get a great deal. Many investors purchase a home or parcel of land and "flip it" for profit. If done carefully, buying a short-sale home can be a lucrative investment.

However, it is important to remember that some short-sale homes have been neglected by their owners. Therefore, buyers should be aware of potential hidden costs, such as repairs and renovations. Buyers will also want to do a title search and make sure there are no undisclosed liens or other encumbrances on the property.

The process of purchasing a home through a short sale can be quite complicated. The seller’s lender must approve the sale, which can take several months. Furthermore, seemingly minor mistakes or oversights can have major implications during a short-sale home purchase. For these reasons, it is highly recommended that individuals interested in purchasing a short-sale home work with an experienced real estate lawyer.

Contact a Cook County Real Estate Lawyer for Short Sales

Buying a home through a short sale can be a great way to reduce your up-front investment costs and buy property for a reduced price. However, there are many pitfalls to avoid if you choose this real estate investment strategy, so dependable legal counsel is crucial.

At The Sherrod Law Firm, Ltd., we can assist you with the purchase of a home through a short sale. We will work closely with all parties involved to help ensure that the purchase goes smoothly and efficiently. Hyde Park real estate attorney Constance R. Sherrod has served clients in the greater Chicagoland area since 2007. She has the legal know-how and experience needed to help you make an informed choice and assist you throughout the home-buying process.

To learn more about our services, contact us online or call 312-321-6910 and set up a free initial consultation.

Source:

https://www.investopedia.com/terms/r/real-estate-short-sale.asp