Bargain-hunting is the name of the game in free market capitalism.
SHORT SALES and FORECLOSURES
We hear so much today about the number of short sales and
foreclosures that it’s natural to wonder if this is where the bargains are. Are these areas that we should be
pursuing? Will we get a “great deal”?
First, let’s go over the difference
between a short-sale and a foreclosure.
A short-sale simply means that a seller is offering his
home for sale - and that he owes an amount greater than the current value. So if the value of a home is currently $100
and the seller owes $105 - he will, upon the closing of the sale, come up five dollars short - hence the term short sale.
Contrary to what you read, being in a short sale position does not always mean that the seller is in danger
of having the bank take his home away. It could simply mean that the owner wants to sell his home for a new job, or
because of a growing family or other reasons. He may indeed have the five dollars he needs to make up his shortage and thereby
can pay all that is owed at the time of the sale - even though he will be taking a loss.
The
short-sales that we hear most about in the news are the homes where the owner owes more than the value of the house and is
being forced to choose between selling and having the bank take the house away because he is behind on his payments with no
resolution in sight.
These sales are very cumbersome and time consuming. If you need to purchase
a house because you have a need to move into it quickly, you should probably not consider this option. The sale price
must first be negotiated with the seller - and then, if the price is less than the mortgage amount, it must also then sit
subject the approval of the lending institution.... ENTIRE ARTICLE 
