Short sales, also known as REO (Real Estate Owned) properties are flooding the markets in all states and are a popular choice among investors and first time buyers. Whats the catch?
Lets first define what a short sale is. It is when a bank decides to sell a property below the mortgage owned on it and accepts to take a loss in order to save itself from dealing with a foreclosure.
Based on the price, they seem attractive and seem like the way to go especially since they have been flooding the market with as much as 48% of the listings in some states being strictly short sales. The catch however lays in the timing and execution of the deal, and in some cases in the condition of the homes. There is a red tape feel to the whole package.
