Short Sales in the East Bay

Do you know what a short sale is?

If a seller has listed their home at the current market value for the neighborhood, but that price doesn't cover his note to the bank, or his "deed of trust," then the seller is selling short.

Short sales mean different things to sellers than buyers.  The first thing to know is that just because the seller is selling short does not mean that they are in trouble financially, so don't make assumptions around the seller's desperation.  Sometimes the seller has to move for other reasons, such as job change, death in the family, divorce and doesn't have enough money in the bank to cover the shortage.  In this case the seller discloses his finances to the bank and negotiates to take a lower offer than the note.  But often the seller is having a hard time and is selling to preserve his credit.


For the buyer, this can mean a long waiting game, as the bank tries to exact all the pain it can out of the seller.  Wachovia has a great process and can approve the sales within weeks, but bank of America, Wells Fargo and Chase (formerly WAMU) are taking six months and longer.  This is not to say that the escrows never close, but I have been in contract since May 2nd on a condominium in Emeryville and closing is nowhere in sight.

Patience is the order of the day if you are going to buy or sell a house short!