PARK CITY FORECLOSURES & SHORT SALES
Bank Owned Foreclosures and Short Sale opportunities in Park City and Deer Valley have disappeared. There are few to no Park City Foreclosures for sale. Although distressed properties such as short sales and bank owned homes can be great buys, there may be much better alternatives in the non-distressed inventory. A good realtor® can help you determine what is the best deal and investment!
Short Sales and Foreclosures for Sale in Park City
No listings were found matching your search criteria.
Park City Utah Foreclosures
- It is much easier to purchase foreclosures than short sales. Typically, you can get a response back from the bank rather quickly whereas a short sale could take months.
- Typically foreclosures sell for close to list price (within 3%). Don't expect to get a huge discount from list price.
- Banks typically will not deal with you if you have not been approved for a mortgage or cannot show proof of funds. Get approved for a mortgage and proof of funds prior to looking at property.
- You can buy foreclosures with the right to inspect. Most banks will give a maximum time of 10 days.
Facts on Short Sales
A short sale occurs when the proceeds from a real estate sale are insufficient to cover the mortgage or balance owned on the property. In a short sale transaction the lender, or lenders, agree to accept less than the mortgage amount owed by the current homeowner due to an economic or financial hardship on the part of the borrower. In some cases, the difference is forgiven by the lender, and in others the homeowner must make arrangements with the lender to settle the remainder of the dept. The owner can not sell the property unless the creditors ("Third Parties") agree to accept a payment that is less for "short" of the amounts actually owed to those Third Parties. This negotiation can take a long time to accomplish. In many cases it takes months to negotiate a short sale. Many Park City short sales do not get approved or fall through for a variety of reasons.
Stringent Qualifications for Bank-Owned and Short Sales
Owners may be pushed into considering listing their home as a short sale when they do not qualify for a short sale. Sellers must prove a hardship and submit evidence of the hardship to the lender for approval.
NO BINDING CONTRACT WITHOUT THIRD PARTY APPROVAL
A Short Sale requires the written approval of the Third Parties. The definition of third parties may include mortgage insurers, bankruptcy trustees, all lien holders such as second mortgages, mechanic liens, federal, state and local taxing authorities. When more than one lien holder is involved, the negotiations are much more difficult. Second lien holders often hold up the transaction to exert the largest possible payment in exchange for releasing their lien, even though in foreclosure they will get nothing. As a result many short sale transaction members complain of unresponsive lenders; lost documents that require multiple submissions, inaccurate or unrealistic home value assessments, and long processing delays, which cause buyer to walk away.
The owner of the property, and any interested buyer, are advised that even if they reach an agreement between themselves for the purchase and sale of the property, that agreement will not be binding until the "Third Parties" approve the terms of the Short Sale. In some cases a buyer may be in default and to entice a buyer the home is listed at a lower price than the bank will accept. Most banks will NOT start the approval process for a short sale until an offer is in hand and will not pre-approve an acceptable price for a short sale up front.
THIRD PARTY MAY REJECT OR MAKE CHANGES
Based on the obvious financial loss, Third Parties will often reject a proposed Short Sale. Lenders reserve the right to renegotiate the terms of the short sale even after the first response. If the market changes, new laws pass or new information crosses the lender's desk, the lender can attempt to change the terms of the contract. I like to tell my clients, every "rule" you thought you knew about real estate, throw out the window when working with a bank, most of them do not apply.
THERE WILL BE DELAY IN RESPONSE FROM THE THIRD PARTIES
The owner and the interested buyer should be prepared for significant delay in receiving any response from the third parties. Depending on if and when a Notice of Default (NOD) was filed, the lender's back-log of short sales to approve and process, While we think the bank would want to get the sale done and off their books, it rarely happens that way. It could take anywhere from two weeks to four or six months to get a response from third parties on a real estate purchase agreement. In addition, if two lenders are involved because there are two loans secured to the property, it could take longer to satisfy the demands of the second lender. In average only 50% to 60% of short sale listings ever get to a closing.
THIRD PARTIES HAVE THE RIGHT TO ENCOURAGE ADDITIONAL OFFERS
As a condition of considering any proposed Short Sale, the Third Parties usually require that the owner keep the property on the market, even after the owner and the interested buyer have agreed to the terms of a sale in writing.
LOSE CONTROL OF TRANSACTION
If you need to close escrow by a specific date, lots of luck with that. A short sale closing process takes an indefinite amount of time. The seller's lender calls the shots, not the buyer nor the buyer's lender. If you are trying to close escrow concurrently with the sale of your home, it is highly unlikely to happen.
The above is meant as informative information and does not represent all facts of Short Sales. There are great variations between each bank; some short sales can be very easy and quick while others are difficult and lengthy.
FINDING YOUR WAY HOME TO PARK CITY
Email Cindy Wallace or call +1 435 901 2781 for impeccable customer service, extensive Park City, Utah knowledge and meticulous attention to detail with over 25 years of local experience in real estate.
