A Legal Overview of Buying a Short Sale Home: An Interview with Robert Newton of The Law Office of Robert Newton

Tell us about your firm and the areas of law you practice.

The Law Office of Robert Newton was formed in 2005. We are located at 6959 Lebanon Road, Suite 212, Frisco, Texas. We practice real estate law, business law, and estate planning (wills and trusts).

What makes short sales an attractive choice for homebuyers?

Short sales offer a unique opportunity to buy a property below market price during a seller's market. A buyer must have the ability to be patient with the process. It can often be very slow. And the bank may not accept the price you are willing to pay.

What role does an attorney play in the purchase of a short sale home?

A short sale merely expands the role an attorney can play during the home buying process. Attorneys often represent buyers in negotiating the contract, drafting the contract, managing the contract period, and then reviewing (and potentially drafting) the closing documents. During a short sale, an attorney must make sure the buyer has the ability to exit a short sale without any damage. Additionally, the attorney may have some correspondence with the bank that is being asked to approve a short sale.

When should someone who is considering buying a short sale consult with a lawyer?

Before the contract process, it is important that a buyer have the ability to cancel the contract and receive back their earnest money in the event that the bank doesn't approve the short sale.

What are some of the biggest challenges with the contract that a potential short sale buyer faces?

The biggest challenge is the patience that may be required. Banks are often slow to approve a short sale. Further, the short sale may be denied during the final days prior to closing, which can truly upset the buyer and the seller. Worse, the buyer may have spent money on inspectors and other service providers.

Do you have any advice about what to be cautious about when buying a short sale home?

To give yourself the best chance of a short sale being approved, be sure to put your best foot forward early in the process. Review the filing history of the property to estimate how much is owed on the loan. Buyers don't want to waste time and money on a contract that will be rejected.

What's the best way for someone to contact you and your firm?

Buyers and sellers may contact me by phone or e-mail. My phone number is (214) 957-1292. My e-mail address is rnewton@rnnlaw.com.