This Month in Real Estate is a monthly video news series that offers an inside look at the national real estate market. Each edition provides a snapshot of the numbers and trends that drive the real estate market, as well as expert opinion and analysis. For information on your local real estate conditions, please feel free to contact me.

Clients and friends will often ask “what is the difference between a foreclosure and a short sale?” They have usually heard of both, but generally don’t know the difference and how it can affect them as potential home buyers. To say that a house is a foreclosure is not quite correct. The house was a foreclosure, but is now considered a bank owned property. The previous owners have already been foreclosed on and the bank is now the owner and has possession of the property.

A foreclosure is offered for sale by the bank that bought the mortgage back on the court house steps, or it is offered for sale by a large asset management company that has been hired to manage their assets, which is just another word for these bank owned properties.

If you are looking at property that is advertised as a short sale or a potential short sale it is not bank owned property. The individuals who purchased the house still retain title to the home, although often they are behind on their payments. When a home is sold in a short sale, the seller’s mortgage lender must agree to the terms of the sale before it can be finalized because the house is being sold for an amount of money that is less than the amount currently owed on the property.

The amount of time it takes to process and approve the terms of a bank owned property sale verus a short sale can vary greatly depending on the mortgage lender. In general, short sales take longer to get approved than the sales of properties that have already been foreclosed on although if the sellers have promptly provided all of the information their lender requires, these sales can be approved in as little as a week or ten days. However, it can also take months to get an approval for a short sale.

The benefit of a short sale for the sellers is that they avoid having a foreclosure on their credit report. Mortgage lenders have become more willing to consider short sales because foreclosures are expensive and with a short sale the mortgage lender never owns the home or carries it in its inventory.

Foreclosures and short sales can offer a good value if you are able to handle purchasing a property with either no representations regarding condition, or no repairs and you can be patient. If you would like more information about short sales or foreclosure properties, please give me a call.

Thinking of selling your home but don’t know how to prepare it? Follow theses simple proven steps to prepare your home for sale.

* Give your home the illusion of extra space. Remove any clutter, like excess furniture, to improve traffic flow and create the feeling of spaciousness.

* Clean your kitchen from top to bottom. Remove any grease stains from your range hoods, stovetops, oven, or any other place where grease tends to splatter. Make your countertop space appear larger by removing any specialty appliances. However, everyday essentials like a toaster or coffee maker are fine.

* Consider painting the interior of your home with a neutral colored paint selection. This step will brighten your home, make it look larger than it really is and give it a cleaner look. Any posters or adhesive art should be removed from all the walls and doors inside your home. Also, be sure to patch up any holes in your walls with putty before painting.

* Remove any dying plants in your yard. Keep your lawn freshly mowed, raked and watered. If you don’t already have any plants, you should definitely consider adding them to your current landscaping. Simply adding a few plants or flowers to your walk way can boost your homes curb appeal tremendously.

* Have all the carpets in your home professionally shampooed. If your carpet is severely soiled and beyond repair, consider replacing it all together.

For other helpful tips and further information about real estate within your area, give me a call.