If you are thinking about buying a short sale or REO you there are a few things that you may want to think about in if this type of property is right for you. If you are thinking about a short sale the 1st thing that you need to determine is the give in your time frame to purchase. If you can remain in there long enough there are many excellent values to be had, but be prepared to wait for a minimum of three to six mo. up to a year or more to close a property as you might have to make several offers and wait for a delayed response from the bank . Likewise a low percentage of homes actually close which could vary in various areas of the U.S., but fewer than 35 percent of short sales close in the Nashville Real Estate Market.
Whether you are looking at a foreclosure or a short sale you should think about that some of these properties have been abused and will likely require some repairs. A blunder many buyers make is underestimating the cost of the repairs. The keen eye of a home inspector can save you thousands in a contract on a bank owned home. Get quotes for any item that you see or inspector notices that will need to be repaired. Being accurate in estimating replacement cost will likely determine the final result of equity achieved by purchasing a distressed home. A expensive mistake is to assume that a bank owned home is always superior value than a resale or new home. They are priced more aggressively because of the fact that they also have a higher risk factor. If you are going to do the repairs on your own do not discount your time in assessing value as your time is your money. If you must spend all your free time for the next 6 months to realize $5,000 in savings, it might not be worth it.
