Before you begin your research, you should Know Your Rights as a consumer - click here for more information.
Foreclosure & Shortsales
SEARCH FORECLOSURES - Click Here
By Definition:
Foreclosure - is a property that has been redeemed by a lien holder. In other words, a property that has transferred legal rights to a bank, corporation, or government agency. Click Here to view the Foreclosure Timeline Chart in MN.
Shortsale - is a property that is in the process of Foreclosure or Mediation (working with the bank to change the terms of the original agreement), but the legal rights to the property remain with the current homeowner. Therefore, the homeowner must receive an approval to sell their home from the bank. Usually the homeowner owes more to the bank than the home is worth in the current market selling the home "short" of its mortgage lien.
If you are in the process of foreclosure and would like to know more information about your rights, Click Here.
If you would like to sell your home and avoid Foreclosure, Click Here
There are many myths when we talk about Foreclosures & Shortsales in today's market. In fact, most of the information we hear is an extreme story that affects less than 1% of the buying population. Below is what you need to know about Foreclosures & Shortsales if you are in the market to buy a home in Minnesota.
1. Is buying a Foreclosure & a Short Sale a GOOD DEAL?
Maybe, Maybe Not. The truth is that EVERY foreclosure and Short Sale sell for what the home is worth at the time of the sale. Foreclosures are listed on the MLS just like any other property that is For Sale, and Short Sales are as well. In fact, if they are not listed, it can be a violation of Federal Law. That being said, homes that are in Foreclosure are generally in worse shape than homes that are not in Foreclosure. Nonetheless, a buyer can purchase these homes for less money than a traditional sale.
2. Do Foreclosures & Short Sales take a long time?
A bank owned Foreclosure will typically respond to an offer within 72 hours of receipt. The bank will have requirements that the buyer must fit into in order to purchase the home. If the buyer hasn't submitted the proper information, the bank will sit on the offer without notice. Having a Good Realtor will help in this process.
Shortsales are a different story. Because the bank doesn't have legal rights to the home, they may NEVER respond to the offer. The seller will have signed off on the offer and submitted it to the bank within 72 hours of acceptance. (Although there is no legal timeline)
3. General Requirements of a Short Sale:
1. Home owner must be in mediation or foreclosure
2. Home must have had proper market time on the MLS (30+ days)
3. Home owner must have a Hardship
4. Home owner must be willing to obtain all information needed
5. A purchase agreement is required.
Less than 30% of Short Sale listings in MN sell as a Short Sale. In fact many go back to the bank and sell as a Foreclosure. The problem isn't with the bank. In most cases, the problems arise because the seller doesn't qualify for the process. A Good Realtor can help avoid these troubled issues that arise.
4. Dos & Don'ts
Do keep Foreclosure and Shortsales in your search.
Do Not solely look at Foreclosures and Shortsales. There are homes that are neither that may be the best DEAL that you are looking for.
Do Not take your Realtor's advice for Granted and Utilize an Inspector.
Do use your best common sense when you are searching.
More Information on Shortsales
YOU CAN ALSO HAVE A PRINTER FRIENDLY VERSION OF THIS IN OUR BUYER BOOKLET. YOU CAN REQUEST A BOOKLET IN THE BUYER'S MORE PAGE.
Call Travis Anderson for more information - 651-485-6383
