Buying a short sale...

[agpalza]

What is the name of your state? California

Basically, what is a short sale? I'm seeing homes at ridiculously low prices and was wondering why they were selling so low.

What's the catch? What are the risks involved for the buyer?

Thanks for helping.

[FlyingRon]

A short sale is where the mortgage company agrees to release their interest in the property for the short sale price (which will be less than what they are owned). The biggest issue is it can sometimes take a long time to get the necessary approvals but if your'e in no hurry it could be a good deal for you.

You do however want to realize that if the guy is defaulting on one note, he may have other encumberences such as unpaid property tax, second mortgages, sewer assessments that he is in arrears on. You'll need to have a title search done and an OWNER'S title policy issued to you (always a good idea anyhow).

[seniorjudge]

And, one more warning: In a lot of places, town, city, county assessments may NOT be of public record (i.e., filed in the land records).

So, check with all jurisdictions before you buy.

[Silverplum]

Regardless, it's not a legal question.