Short - Sale

Still pricey for a 1 bedroom on the first floor, but nice find.

Short sales in Manhattan? Uh-oh, Houston we got a problem.

That's not a short sale... that's a train wreck. The liens on that property are probably about $1.8MM.

Excuse my lack of lingo knowledge, but what is a short sale?

Let's say you owe $1 million on a mortgage. But you can only sell your apartment for $800,000. That's a short sale. Basically, as the seller, you have to show up at the closing with a check for $200,000 to pay the bank.

Ouch ouch ouch!
A short sale is one involving the seller & the seller's bank as a way of staving off foreclosure. The seller bought this place for 1.875M in 2006 (where were his advisors?!), and will sell it for less than the outstanding mortgage amount.In a short sale, a cash buyer is especially appreciated, as there may be a time element and a long escrow period is undesirable. All proceeds from the sale go directly to the bank.

I would be wary of this - there was a broker who used to promote "foreclosure deal" allover Chelsea and it was just bullshit to drive traffic. Like this.

scoots: At the asking price, it's a legitimate short sale - short by around $700K, based on two bank liens and a lien for common charges.

To elaborate on Slope11217's post a bit: The seller doesn't always have to show up with a check. The lienholder can agree to take (or share) the loss to avoid the costs and delay associated with foreclosure.

I'd like to know who appraised that property in 2006.

if anyone else comes across another short sale, i would appreciate if you would post it

Train wreck is right. Sold by sponsor in 2004 for $.733M, sold in 2005 for $1.2M, then sold in 2006 for $1.875M. The 2005 seller then turned around and paid $2-something-million for #3C. There's also a common-charges lien against her. (BTW, where'd we be without ACRIS?)

true, i LOVE ACRIS!

In a short sale, the seller doesn't necessarily have to pay the difference between the sale price and the outstanding loan balance. It depends on the deal the seller has worked out with the bank.

NEW MARKET "SHORT-SALE" OPPORTUNITY AT A REDUCED PRICE!!!

This is not a real Short-Sale. No bank ever advertises a short sale. Short sales offers are usually brought to a bank for consideration and are very hard to obtain.
BTW a real short sale is when a seller finds a buyer who is offering lower then the existing mortage. The bank is then approched for approval. It is very hard to get the bank to go along with this.
Just read up on what has been going on in CA, AZ and NV

Short sales are becoming common. It is driven by the owner and most are even listed with an agent. If a bank belives a borrower is going to default, specifically if they are 60+ days delinquent on their mortgage, they would rather not have it go through foreclosure/REO. If they own it, they have to pay utilites and maintainace for the property. Short sales are happening in a lot of areas right now. I went to see one in the hamptons.

"This is not a real Short-Sale. No bank ever advertises a short sale. Short sales offers are usually brought to a bank for consideration and are very hard to obtain.
BTW a real short sale is when a seller finds a buyer who is offering lower then the existing mortage. The bank is then approched for approval. It is very hard to get the bank to go along with this.
Just read up on what has been going on in CA, AZ and NV"

This is not necessarily true. They have become more common and are marketed in this manner - but this is the first I have seen in Manhattan.

Sorry to disagree with you pal. If a bank does a short sale then they have to carry it on their books as a loss. If they REO then it does not appear as a loss to them. It is extremly hard to get a bank to approve a short sale also because of the problem that few bank truly holds the mortgage. They all have been sliced and diced into baskets.

Also short sales are usually brought to attention of bank after offer is made. So therfore they can't advertise something that hasn't happen yet.
Therfore this is just some marketing bullshit

Ruff: You're probably right that they are using a bit of literary license in calling this a short sale. I suppose the defense there would be that, from a buyer's point of view, it's the same as a true short sale: the asking price is substantially below the outstanding balance of the liens.

Now, whether a buyer should CARE that it's a short sale is another question. Personally, I think it's irrelevant. The property is worth what it's worth. If some fool (or scam artist) borrowed 40% more against it in 2006, that doesn't mean much to me in the here and now.

I vaguely remember reading an article in the past 3 months that banks have many disincentives to agree to short sales, but cannot seem to find the article. anyone?

Question for 30yrs. and others that might know: I came across a bank sale. Do you know if they are happening more often in NYC and if the process is getting easier?

What does REO stand for?...thanks

"Real Estate Owned" (i.e., by bank)

http://en.wikipedia.org/wiki/Real_Estate_Owned

Yeah just looked in wiki. I took the bar ages ago in a state with different rules (deed of trust).