John Procenko Real Estate is a Markham Real Estate agency. For current listings, visit http://www.procenko.com/. They are located at 165 Main Street Markham North Markham, ON L3P 1Y3‎ (905) 472-7155.

1. Basic Information About
Short Sale Homes

2. Even though the basic premise is quite simple, the
world of real estate can get pretty complex sometimes.
In many instances, homes for sale aren’t just homes for
sale, and there is more to it than meets the eye.
Sometimes the special circumstances are brought on by
the buyer, sometimes it’s the seller and sometimes the
lender. One such instance is known as the short sale.
Short sale homes don’t come along everyday, but when
they do it can be a very intricate situation.

3. What Is a Short Sale?
Basically, a short sale is a situation where the seller is
having difficulty with the mortgage and wants to sell his
house for less than the balance remaining.
The reason that a seller would request a short sale is to
avoid full foreclosure on the home.

4. Who Benefits?
In a short sale, all three participants may stand to
benefit once the deal is done.
• The bank benefits because they don’t have to incur
the time and expense of repossessing a house.
• The seller benefits because he can avoid any negative
credit consequences of foreclosure
• The buyer might end up benefiting by being able to
purchase a house for less than market value.

5. Buying a Short Sale Property
Buying a short sale property is not like buying other
homes for sale. In reality, it is like making a traditional
home purchase, although the bank has to approve the
sale so it can also seem like you’re buying it from the
bank even though that isn’t the case.
The reason the bank needs to approve the sale is
because they are the ones taking the loss from the sale
being less than the amount owed to them. In a normal
transaction, only the seller would have to approve the
deal.

6. Buying cont…
While you may end up getting a break on the price, you
will likely have to accept the property ‘as is’. Neither the
bank nor the seller will be in the position to make any
repairs, so even with a home inspection you’ll probably
have to take it in its present state.
And since the bank is already taking a loss, don’t expect
a reduction in the price if any inspection reveals
problems.

7. Get Ready to Wait
One quality that really comes in handy with short sale
homes is patience. A bank might take up to several
months to process and respond to a short sale request.
With traditional homes for sale, the wait time can be
less than a day if the seller likes your offer. Sometimes,
giving the lender a deadline to provide a response can
reduce your wait time considerably.

8. Things to Consider
Here are some things you may want to consider if you
are thinking about buying a short sale property:
• In some cases the buyer is getting a house below
market value.
• in some cases the bank has done a market analysis
ahead of time and won’t accept anything lower than
market value.
• in some places, the seller must pay the bank the
difference between what he owes and the sale price, so
his goal is to get the highest price possible.

9. More Considerations
• Unlike many bank-owned properties, a short sale
home is less likely to be damaged or ransacked.
• It’s wise not to assume that the house is a great deal
just because it is a short sale property. Do your own
research and analysis to ensure you’re getting the
deal that you think you’re getting.

10. How to Make It Work
Here are some tips for making a short sale work:
• Find an agent that has experience with short sales as
well as other types of homes for sale.
• Make sure your agent is ok working a short sale and
the extra work it may entail.
• Find out if the listing agent is experienced with short
sales. This may speed the process.
• Make sure the short sale is lender approved.
• Word your offer in such a way that you can back out
if you find a better deal while you’re waiting for a
response.

11. References
John Procenko Real Estate is a Markham Real Estate
agency. For current listings, visit
http://www.procenko.com/. They are located at 165
Main Street Markham North Markham, ON L3P 1Y3
(905) 472-7155.