What is Short sale? Good question.
Short sale is when the sale proceeds do not cover the mortgage amount and the costs associated with the sale of the property.
So, if your mortgage payout is $300,000 and the buyer is paying you $280,000,it is a short sale. The difference in this sale is that the mortgage holder will have to be consulted before the deal becomes firm and binding. The lender will either have to take the loss of
$20,000 or arrange for a line of credit for the sellers.
It is rare to see a short sale, but down South it is a very common process. In the USA the short sales are coming on the market faster then the foreclosures and if they don’t sell fast enough they will become foreclosures. However, here in Canada short sales are very few since our Real Estate markets are more stable and our mortgage structure allows for the homeowners to renegotiate and restructure their mortgage rates and their terms every 5 years.
Have a story you would like to share, or a question about short sales? Leave a comment below, I would love to read them.
Tibor
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A single-level Rancher in one of Abbotsford's most popular complexes. This unit is situated in a quiet part of the complex, and it has many...
Abbotsford Market Watch
 What is a pre-sale? Example scenario: When the developer intends to build an apartment building and applies for financing, the bank will grant financing under certain conditions. One of them will likely be a certain percentage of pre-sales the developer will need to secure before receiving the funds.
It is common practice for a developer to approach several real estate investors and offer them an opportunity to purchase units of the non-existent building at a discounted price, and on good terms. Once the number of pre-sales is accomplished, the developer goes ahead with the construction, which will likely take two years or longer to complete. During construction, their marketing team offers the remainder of the units for sale at market value to the public. If you are a RE investor, you know that it is preferable to be buying at the pre-sale prices, not market value prices. The question is, how do you get the invitation to buy a pre-sale? In the past many years, investors have made substantial income by buying at wholesale prices and selling at retail prices even before they needed to complete their purchase. I saw many of them lining up and sometimes even camping overnight in front of the sales center to get a chance to buy at lower prices, but not everyone was lucky enough. You needed to be well-connected to get an opportunity, and you had to act fast. Today is a bit of a different story. Several projects in the Lower Mainland and Fraser Valley offer really good prices and incentives to secure a unit now and complete the purchase two or three years later. The list of incentives varies from one project to the next. Besides attractive prices, you can get low deposit amounts (5-15%), low or no assignment fees, free updates, a mortgage rate buy-down program, extra parking and more. A month ago, I helped a few of my clients purchase a presale in Surrey that sold out in 2 days, and I know of another good developer that will be offering a few units for sale as well. If you would like to know more about these opportunities, I would encourage you to call or email me, and I’ll be happy to send you details on those projects. Kind regards,
Tibor Bogdan
Century 21 Creekside Realty Ltd. 45428 Luckakuck Way #190, Chilliwack, BC V2R 3S9 cell: 604-855-2521 |
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