Delaware short sales, Delaware distressed property buying tips

Here are a few Delaware short sale listings that were listed on the MLS/IDX system within the last ten days:

See more Delaware short sale listings!

There are many great opportunities to purchase Delaware short sales under current market conditions. This may be a great time for you to buy your Delaware beach home or that waterfront property near Rehoboth or Lewes Beach. But buying a home short sale is not for every home buyer. There are challenges that you will need to weather through. Let’s talk about a couple of these :

Delaware home buyers need to have a lot of patience plus you need to be flexible when considering settlement date. If you need to settle on a home as soon as possible, then a short sale is not for you. I have seen short sales in Delaware take anywhere from 8 weeks to 12 months to settle.
Buyers of Delaware short sales or foreclosures often times are incurring fees before the the lender even approves their offer. These expenses may be for inspections, to lock their interest rate, turning on utilities to name a few. Sometimes a buyer has to make repairs to the home in order for their lender to approve their loan. If for some reason, the sale does not get approved or moves forward, the buyer does not recoup that money.
As a buyer making offers on Delaware short sales, we suggest only making a nominal deposit when signing a contract. The reason being that a short sale process can take several months and that is months of tying up a buyer’s funds. Plus if the short sale effort is unsuccessful, the broker holding the good faith deposit will not refund the deposit without the seller’s consent. In the State of Delaware, in order for deposit monies to be reimbursed to the seller, both buyer and seller must agree to that release and that is done by signing an addendum to Release Funds. If a seller is unwilling to release the funds, the buyer could be forced to take legal action for the deposit.
It is not automatic that a short sale is approved. The seller may abandon the deal. A buyer may run out of patience or find another home. The property, often vacant, may become damaged. These are a couple reasons that can prevent the settlement of Delaware short sales.
Remember, the seller in a short sale usually lacks funds for repairs to the property. The bank will almost never pay for repairs in a short sale. So should your home inspection find problems or if it is evident that house is in need of repair, the buyer has no choice but to buy the home as is and pay for the repairs himself, or walk away from the home.
A buyer may run across valuation issues. A buyer may be surprised at how hard it can be getting a short sale lender to adjust the bank’s valuation of a property to reflect the true value of the home in today’s Delaware real estate market.
The lienholders of the property may change the contract terms as a conditionof the short sale approval. They may want to increase the offer amount, reduce or eliminate settlement help or require other modifications prior to settlement.
There is always a risk that other offers are received once your offer is submitted to the lender. Be sure you find out the listing agent’s policy on multiple offers as this could “bump” your offer into a different position or out of the game!
A short sale doesn’t automatically mean a great buy. Yes, Delaware short sales can be wonderful home-buying opportunities, but they can also be a “can of worms”.