How To Find Short Sales In Your Area

With all the homeowners defaulting on their mortgages these days, there are a lot of short sales currently on the market in Arizona. How does a potential buyer find short sales, though? What does a buyer need to know about short sales? Here are some tips on how to find short sales.

Short sale basics

A short sale can be the result of dropping property values, making the home worth less than the balance of the mortgage on it. Inflated appraisals and property values can also cause homes to be purchased for more than they are really worth. When the market adjusts back down, many homeowners find themselves underwater on their mortgages. When the owner agrees to sell the home for an amount that is less than the home’s present mortgage balance, then the lender must approve the short sale, because the lender is taking a loss.

Buyers should be careful when considering a short sale. A short sale can take a long time to close, and a lender can pull out of a short sale agreement so the sale never closes at all. Many short sale prices that are advertised are not real prices but estimates at what it will take to sell the home. If you are still interested in buying a short sale, here are some ways to find them.

How to find short sale listings

Most importantly, find an agent who is experienced in dealing with short sales and can give you sound advice. Sellers’ real estate agents list short sales. These listings are on local web sites and in MLS feeds. Lenders have complained about advertising identifying a listing as a short sale because they feel buyers offer less when they know it is a short sale property, and they are generally right.

Agents frequently slip in wording that identifies a listing as a short sale, so look at the listing carefully. Here are some terms to look for:

  • Subject to bank approval
  • Preforeclosure
  • Notice of Default
  • Give the bank time to respond
  • Preapproved by bank
  • Headed for auction

Every MLS system is different, but with the advice of your short sale real estate agent, you should be able to find suitable listings in your area.