MIAMI FORECLOSURES & SHORT SALES IN MIAMI
In real estate, a short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a mortgage loan. In a short sale, the bank or mortgage lender agrees to discount a loan balance due to an economic or financial hardship on the part of the mortgagor. This negotiation is all done through communication with the bank since the lender would have the right to approve or disapprove of a proposed sale and given that the home owner/debtor sells the mortgaged property for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender.
Extenuating circumstances influence whether or not banks will discount a loan balance. These circumstances are usually related to the current Miami real estate market and the borrower's financial situation.
A short sale typically is executed to prevent a home foreclosure. Often a bank will allow a short sale if they believe that it will result in a smaller financial loss than foreclosing. However from a buyer’s perspective they tend to take longer than the purchase of bank-owned (REO) real estate since most of the time they need to appraise the property and be convinced that the existing owner/debtor cannot continue holding the property. In short, a short sale is nothing more than negotiating with lien holders a payoff for less than what they are owed, or rather a sale of a debt, generally on a piece of real estate, short of the full debt amount.
The wide array of parties, parameters and processes involved in a short sale makes it a relatively complex and highly specialized type of real estate transaction which is why unfortunately short sale deals have a high failure rate and often do not close on time to save homeowners from foreclosure when they are not handled by a knowledgeable and experienced professional. Having assisted multiple buyers with the purchase of short-sales allows us to work with buyers, sellers and banks to reasonably achieve the common goal, which is to transfer the property to a ready, willing and able buyer at a price that reflects the current marketplace.
BANK OWNED PROPERTIES IN MIAMI
Real estate owned or REO is a class of property owned by a lender, typically a bank, after an unsuccessful sale at a foreclosure auction. This is common because most of the properties up for sale at these auctions are worth less than the total amount owed to the bank.
After an unsuccessful auction, the bank will go through the process of trying to sell the property. They remove some of the liens and other expenses on the home and try to resell it to the public. Generally speaking, bank REO properties, particularly houses more than condos, are in poor shape in terms of repairs and maintenance; however, buyers will often go after these properties as banks are not in the business of owning homes and so, in some cases, the low price can more than compensate for the condition of the property. Usually these types of transactions tend to be speedy as the seller/bank knows the value and has priced the property for what they would be willing to accept.
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