The recent housing market crisis has brought the term “short sale” to the attention of the public. A short sale is different than a foreclosure, point out the investment professionals at New Wealth Advisors Club. It can be a valuable investment tool for those looking to break into real estate.
A short sale is not the same as a foreclosure. When a house is a short sale, it means that the value of the house is lower than the amount the owner owes on the mortgage. The owner is usually struggling to make mortgage payments. The bank that owns the mortgage will often agree to accept a lower amount to pay off the mortgage, note the team at New Wealth Advisors Club.
Short sales let homeowners avoid foreclosure. New Wealth Advisors Club notes that the short sale process gives an investor an ideal opportunity to help out a person in need. To qualify for a short sale, a homeowner usually has to prove that he or she is suffering from a financial hardship, such as the loss of a job.
Short sales are usually more involved than the regular home buying process, even for investors who are experienced. It can take a few months for the sale to go through. Plus, some houses up for short sale might have a few mortgages or even a lien on them. It’s essential that everyone involved in the house agrees to a short sale before the sale can go through.
The team at New Wealth Advisors Club recommend not putting all of your eggs in a single basket when investing in short sales. It’s possible that the sale could fall through at the last minute. It’s better to have a few options floating around, in case one or more investment opportunity fails to materialize.
There are a number of benefits of investing in short sale homes that make the length and uncertainty worth it. The investor is usually getting a fantastic deal on the house, since it’s going for a bargain rate. Usually, the previous owners have maintained the home, so an investor won’t have to put a lot of money into the house.
New Wealth Advisors Club is a community of individuals who are dedicated to creating wealth through real estate investing. The Club is constantly on the lookout for individuals who share the entrepreneurial mindset of the Club’s founders.