Bank lenders only will let a homeowner do a short sale if it is going to cost them less than it would to foreclose on the house. Also, if a finance company has a lien on the house, that company has to accept the terms or they can demand payment from the borrower. Basically, it is up to the financial institutions and the primary lender as to how much the owner will be let off the hook, if at all. Here are some ways to navigate through the process of buying a short-sale house.
Know that what you’ll have to do is bring an offer to the bank that makes it hard for them to turn down. Usually, the buyers they’ll take are the ones who put down a big down payment, have gotten approved already for a loan, and place little to no contingencies on the offer. Banks have separate companies that deal with the short sales for them.
You’ve got to have someone on your side that also is familiar with short sales, and knows how much you should offer, and if you should deal with that specific house at all. Don’t just hire any realtor. It must be one that has experience in this area of real estate. You might have trouble finding a real estate agent who knows how to go through these sales, but it will be worth it. Also have a real estate attorney on hand for any questions that confuse you within the contract.
You’ll also have to know when exactly to walk away. If the lender seems very hard to work with, or is being very unfair regarding the terms, it might not be worth the sale. Only buy a short sale property if you can get an excellent deal, with contingencies that (for the most part) work to your benefit. For further reading, see this article on Buying a Short Sale Property, and, Buying a Home in a Short Sale Can Be Profitable.