What Every Buyer Should Know About Short Sales/Foreclosures

By. Gina Ragusa

Rock bottom rates and a slowly recovering economy have positioned short sale and foreclosure properties in an extremely attractive light.

Lenders report that bargain properties have been snapped up so quickly within the past few months, inventory has dropped significantly. “It becomes a seller’s market when inventory drops to these low levels,” explains Doug Leever, Mortgage Sales Manager at Tropical Financial Credit Union ($700 million, Pembroke Pines, FL).

Leever says that he doesn’t think the short sale/foreclosure drought will last long as big bank pipelines continue to release properties into the market. “The big banks will most likely be releasing more inventory so buyers should be ready.”

Florida Realtor Peter Crowley says that demand for low priced properties remains high. “We’re not seeing a huge flood of foreclosures, but a strong flow is beginning to hit the market, and the demand is there for these properties,” he told The Herald Tribune. “It’s going to take some time before we actually see all of these.”

The Mortgage Bankers Association reports that foreclosures fell by their largest margins in 34 years with almost 3.7% of all mortgages were in foreclosure at the end of 2012, down from 4.4% one year ago. “We’re well on our way back to what is perhaps a new normal,” said Jay Brinkmann, the MBA’s chief economist in a Wall Street Journal article.

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