By Chad Huebener
For our West Savage neighborhoods, active and pending sales are holding steady. There is a decrease in active inventory which can primarily be attributed to steady pending sales keeping inventory at bay.
West Savage is continuing to see a supply of short sales come on the market. Short sales differ greatly from foreclosures. Foreclosures are bank-owned homes where the bank is the seller and is offering no warranties on the property. Often times these homes need TLC and are offered at a discount. The list price is one the bank will accept, and like most other sellers’, this price may be open to negotiation.
Short sales, on the other hand, are properties where the seller still owns (and may or may not reside in) the property. However, the value of the home is less than the amount owed on the mortgage. In most cases the seller has stopped making mortgage payments and is anywhere from two to twelve months away from foreclosure. In short sale situations, the seller’s lender must approve any offer on the property, as the lender takes a financial hit on the loss with approval of the sale. Lenders will not negotiate a short sale until an offer has been received, hence, the initial list price of a short sale listing is not necessarily a price the bank would be willing to accept. Rather, it is a price used to generate an offer and begin negotiations.
Once an offer comes in, a two-three month wait for an approval or denial of the offer is normal. Lenders may attempt to prevent the seller from selling the property by offering discounted mortgage payments for a period of time. In cases where the seller will not agree to such programs, the bank may deny any offer from a prospective purchaser, which may put the seller in a “pickle”. Short sales may take anywhere from 2-4 months to complete from the time an offer is received, and are difficult transactions. Approximately 1 in 5 short sales close successfully.
Short sales in West Savage have not impacted any neighborhood less than another, and no income bracket has been spared. They are present in Hamilton Hills, Hamilton Hylands, Oak Hills, The Pointe, Woodhill, Summit Ponds and Heatherton Ridge. We continue to assist sellers with short sales to help them avoid foreclosure, and to help protect property values, as foreclosures drive down home prices and have an adverse impact on everyone who owns a home in the area.
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