Short sales and foreclosures on Hilton Head Island continue to be rare opportunities for our purchasers and sellers.  As you explore these unique changes in the market we want to provide the latest updates and information as it becomes available.  Listed below is some of the information we have learned about short sales and foreclosures.

Two updates from our short sale guy for Sellers of Short Sales and foreclosures:

1. It typically does not matter if a property goes to foreclosure or is sold in a short sale, banks are required to 1099 for the loss either way.  In foreclosure the loss is almost always higher than a short sale which is why the banks accept a short payoff.
2. Sellers that participate in a short sale or foreclosure should make sure their accountant is proficient in issues relating to the loss on sale of rental property and 1099’s for debt forgiveness on the sale of rental property.  There may be losses on the sale of the property and solvency test exclusions that have to be accounted for and in most cases wash out the 1099 income or allow it to be ignored, whether from short sale or foreclosure.

Lessons we have learned handling Short Sales on Hilton Head:

1. Short sales test and reward patience ~  Sellers, purchaser and agents need to relax until the bank responds
2. It needs to be a deal now and later~ With fair market value of our real estate changing almost daily, what is considered a deal now needs to be a deal in a few months or the buyers walk
3. Leave room for negotiation ~ Buyers expect a counter, but if they negotiate with sellers, they will have less ability to negotiate with the bank(s).  Sellers should not care how low the first will go or what the offer is.  They should care more about the ability of the purchaser to perform.  If they have a large second lien holder, the seller should hope the first goes real low because than the buyer has a greater ability and interest to contribute to help out.
4. Negotiate only one time ~ Typical real estate transactions have influenced our buyers and to negotiate more than once with them is difficult at best.  Sellers prices should not be moving targets.

Please click here if you are a purchaser and would like to see the current short sales we offer, or click here for the current foreclosures on Hilton Head Island.  If you are a seller and have not yet explored short sales and how they may help you get your property sold, please give us a call at (843)842-0803 or email us at robbie@robbiebunting.com.  We have a short sale specialist that can easily explain the process to you.  Thank you.