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Question: I want to buy a house, but it seems like most of the homes are “short sales” and I am told that I am wasting my time trying to buy one of those. Why so many “short sales” and is it worth it to pursue the purchase?
Answer: There is a large quantity of “short sales” because people realize they are paying for a house that is worth far less than what was paid, and the owner can’t afford the payment any longer.
The other option for the owner is to let the property go back to the bank, but the credit consequences are more severe if that happens.
Since 2007, home values have dropped and in some areas by as much as 50 percent from the peak. Banks realize that it is better to sell the property “short” rather than take it back, as generally the bank will have a better outcome financially.
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