Panama City Beach Florida Short Sales
The Panama City Beach Florida Short Sale market provides investors and home buyers great opportunities to purchase property both condominiums and single family homes for below current market prices. This is a great strategy for building wealth in real estate. There are a few pitfalls to these types of deals. They are similar to the foreclosure market. The biggest difference is on a short sale, the buyer is negotiating with both the bank and the owner/seller. The bank has not taken the property back and it is in lieu of foreclosure. That being said, the seller/owner also has a say in the process.
There are two ways for a mortgage company to handle the short sale: 1) 1099 the seller/owner or 2) the seller/owner takes a loan out for the difference. If the Seller/owner takes a 1099 for the difference they have to pay tax on that money as earned income based on their tax bracket, the loan gives the obvious result. So it’s in the seller’s best interest to minimize the difference from the mortgage amount to what you are purchasing the property for.
On the bank/mortgage company’s side, there is negotiating room. One key point is letting them look at your credit and financials. This can help, in some cases, reducing closing costs and bank/lender fees since they already have the primary loan. It is in there best interest, if you have solid credit, to keep the loan in house instead of allowing some other institution to draw the interest. Where the Panama City Beach Florida Short Sale market hits home is in relation to the need for affordable housing and rental property. There are two potential strategies based on the current occupant of the home.
If the home is currently occupied by the seller/owner, try to negotiate a rental agreement with them with a potential purchase on the back end. This could actually allow the investor to have a guaranteed tenant(and cover his mortgage) and potentially allow the owner/seller to buy back the same house 1-2 years later for less than what they currently owe! That’s right…a win win for both partiers.
If the home is currently being rented, try to negotiate a deal with the current tenant to cover the note. Like any other rental property, it’s a business decision! Don’t speculate!!! That’s what got many investors/speculators in trouble!! Negative cash flow is not a good strategy for income producing property. Please see other articles on our website on investing strategies on income producing properties.
Obviously if you are looking for a Panama City Beach Florida Short Sale property to occupy for your own personal residence, make sure you can afford the payment and the overhead so you don’t get in the same ballpark as the current owner/seller!
There are great opportunities in the Panama City, Panama City Beach, and Destin Florida areas when looking for Short Sales. Don’t hesitate to call us today and let us help you find that perfect home or condo for you today.
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