Short sale bids require some sophistication, skill and patience on the part of the investor. But, with a little study, and some experience, short sales and foreclosures can be the most profitable way to invest in real estate.
A short sale usually occurs when a seller can’t make his loan payments because of death, divorce, job loss or other hardship. When homes are rising in value, owners can sell the house and pay back the lender. A short-sale foreclosure is a lender accepting a loan payoff for less than the amount owed.
In today’s market, when home values are dropping and the owner hasn’t built up much equity, lenders will often accept less than the amount owed to avoid the hassle and expense of auctioning the house.
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