Jan. 12, 2011

Hawaii Short Sale Real Estate Potential

Most of you new home owners do not realize that if they knew what to look for they could have bought a piece of real estate a lot cheaper than the value. Short sales are when real estate has a mortgage attached to it and it sells for less than the value of that mortgage. This is mainly allowed when the broker decides that the short sale will benefit them more than the process of a foreclosure. When a short sale is done and the purchaser is happy, the property still might be resold at a greater value, giving the short sale buyer a profit.

 

Before jumping head first into a short sale, you should know exactly how to go about doing so legally and intelligently. The process of buying a home for less than its value, then turning around and selling it at value for profit, is called flipping real estate, or flipping short sales. Although before jumping into this, you should learn that some homes are worth less than their mortgage loan, meaning you will have to pay out more when you buy the house than its worth.

 

First and second mortgages from different lenders could pose a problem for a potential buyer. The second company might insist that they be paid all of the owed money at the sale of the home. If you are good at negotiating you might be able to work out a deal with both companies to help settle the debt of the previous home owner.

 

An approved price is what to look for with short sale real estate. These prices have been set firmly to get the home sold so that the company with the loan can move on and so can the real estate agents. Properties with an approved price normally do not have liens attached, therefore, they are the least problematic.

 

When offering a price, try to be somewhere in the vicinity of the asking price of the short sale. More than likely, if the price is already set, then they have agreed on that price for the real estate to be sold at, nothing less. A lower than priced offer will be accepted but a low ball offer will be rejected. Offering a low ball might hurt the process, another buyer might swoop in with a number more in their liking, thus not giving you time to counter your first offer. Be cautious in how you play your "cards" when planning to buy a Hawaii short sale real estate.

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