The moment you decide to buy a new house; begins an everlasting debate in your subconscious mind. Every wannabe homeowner or real estate agent has faced this question at least once in their lifetime. Which should I buy: a short sale or a foreclosed house? Get to know about Short Sale vs Foreclosure.
We have been helping people to sell and buy houses in NYC for the past nine years. Till today, whenever a customer approaches us with the same question. We make sure he/she leaves with the exact answer they were looking for. Even though both foreclosure and short sale come under the category “the current real estate trends of New York”, buying one wouldn’t be as easy as it seems. Only go for these if you have got ample time and a strong gut.
“There’s really no cut-and-dry answer. It depends on the buyer and what the buyer’s priorities are”. If you are running low on budget or trying to find the best possible deals for buying homes in NY, opting for foreclosed and short-sale homes can be the best option. As there are Yin and Yang for every living and non-living thing in this world, both foreclosure, and short sales also have their pros and cons. You might be wondering whether this is again a Short Sale vs Foreclosure article. Our one-word answer to the question is “Yes”. This is indeed a Short sale vs. Foreclosure article but with a “twist”.
Buying On a Budget
Owning a home has always been an all-American dream for most of us. Matt Hamilton approached us with the same goal in his mind. Since he has been living as a tenant since 2010, buying a home in NYC was pretty much a dream come true for him. He recently switched jobs and needed a neighborhood to accommodate his nuclear family comfortably. We gave him two options; a foreclosed home and a house listed under short sale as he was on a budget. We helped him to shortlist the list down to two houses and made sure his decision was respected and full filled.
A full-fledged home within your budget is the appealing factor for both foreclosure and short sales houses. If the situations are in favor of the buyer, he/she can acquire the desired home for almost as low as 37% of the real listed price of the property.
It’s a Risk Worth Taking
There’s always risk involved when buying a short sale or foreclosed home. A foreclosed home might be closed down by the bank. It may happen (foreclosure by a bank) due to the default in mortgage payments. Such houses might be closed down for weeks or months and the repairs conducted will be near to nil. Considering this factor, short sales are much better as the present owners will be living there before you move in and all the repairs and renovations done will reflect in the final price of the house.
The biggest challenge is that you are buying a property in NY with just looking at the pictures as taking a walk-through or having the property inspected by a professional is not allowed in both of these scenarios.
Foreclosure vs. Short Sale
Most of you might have come across the flyers which say “foreclosure homes for sale and foreclosure auction“. Well, before taking these lightly know that there might be a fortune hidden behind. When it’s short sale vs foreclosure, everyone will have their own opinions. Rachel McGraw, who bought a short sale property in NYC about a year ago says she’s a big fan of short sale houses. “The deal was great, and with the help of a professional short sale negotiator from Elite Properties got me a fortune”, says Rachel. We helped grab her house for a dot of $225,000 while the home was listed for $50,000 extra.
1. The time it takes to complete a foreclosure deal is shorter than a short sale
Foreclosure takes less time in completing the paperwork and handing the key over to the buyer. A majority of the buyers writing offers for foreclosure homes will receive a response within 48 hours. If it’s a bank foreclosure property, the whole tiresome process can be done in a period as short as 30 days.
In buying a foreclosure, you will be dealing with a motivated and unemotional business-minded seller. This seller’s primary goal is to sell the property quickly for all cash. When it comes to buying a short sale house you might be dealing with an owner who has mixed emotions about the property and might, in turn, slow the whole process down.
2. Follow your Gut When buying a foreclosure in New York
Well, if you get a gut feeling that the price offered for a property is the best price you can ever get, then just go for it. Buying a penthouse apartment in NYC is a lot less scary with the ‘as is ‘factor in foreclosure. The city itself offers a decent standard of living for almost every type of house and condo.
With short sales, even though you can get a house in its best condition, it isn’t sure that you can always land the perfect deal. The location matter a lot and the house must be in a buyer’s market. In a buyer’s market, the seller might be willing to consider all the terms and conditions of the buyer. But it’ll be after successful confirmation of the property deal.
3. Banks favor Short Sales rather than Foreclosure
A foreclosed property has always been a burden for both banks and lenders. That is the main reason why banks don’t entertain property foreclosure. Listing your property under short sales will benefit the seller as well as the bank. Working with a knowledgeable buyer’s agent will increase your chances of short-sale negotiation. By this, you can land a great deal with the bank.
Experience Does Matter
Hire a foreclosure expert in NY to deal with all the troublesome situations that you might face in buying a property. He/ she will have the knowledge and experience needed to cover all the documents and paperwork relating to purchasing a foreclosure property.
The same goes for short sales too. An experienced short sale specialist might help you to land the best deals for your desired property. This is the difference between Short Sale vs Foreclosure Homes. There are even real estate agents in NY who offers short sale packages in New York to attract more and more customers in buying short sale properties. Hire a professional real estate agent who provides foreclosure services and short sale services so that you’ll have access to their enormous short sale and foreclosure listings in NYC.