The recent decrease in home prices in Vero Beach, Sebastian and through out Indian River County is partially due to short sales during pre-foreclosure. Bargains seen in Bank owned properties that have gone through the foreclosure process are also spurring buyers and Investors to act.
Distressed properties are typically sold at 2 different stages of the Vero Beach foreclosure process.
Pre-foreclosure – when the seller is behind on payments and owes more than the home’s value, the lender may accept less than the loan payoff, a “short sale”. Public notice of this situation is made by filing a Lis Pendens
Post-foreclosure – is after the bank takes title and markets the property, also called an “REO” (lender owned) property. I have extensive experience with both stages and will explain the pros and cons of each approach.
Short Sales – since the home is usually occupied, it is being maintained and likely to be in better shape. The short sale process is still evolving – many lenders are overwhelmed and unable to respond to offers in a timely manner. This approach requires a great deal of patience from the buyer since the time from offer to closing can be 3 months or more.
Lender Owned – the property is usually listed with a Real Estate Broker and the process of buying is far more efficient. Although you are still dealing with a lender (not unlike a bureaucracy), this system has been in place longer. The downside is that the home has often sat vacant and is in need of repair. I always recommend a professional inspection regardless of outward appearance.
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