THE SHORT SALE SOLUTION
THE SHORT SALE SOLUTION
A short sale can be an excellent solution for homeowners who need to sell, and who owe more on their homes than they are worth. In the past, it was rare for a bank or lender to accept a short sale. Today, however, due to overwhelming market changes, banks and lenders have become more negotiable when it comes to these transactions. Recent changes in corporate policy and the Obama administration have improved the chances of getting a short sale approved.
Generally, the homeowner/borrower will present a hardship and the home will be upside-down and that homeowner/borrower will hire an agent to list and sale their property short of what is owned on their mortgage. It will be up to the Lender to say yes or deny you for your short sale request. The process is not a clear path by just asking and getting a short sale approval letter – it is possible to receive an approval.
Short sale is one way you can avoid a foreclosure. While you will still have to leave your house, you will not have a foreclosure appear on your credit history and you will avoid the potential public sale or auction of your house. Additionally, you will have more control over the timing and manner in which you leave your house. My goal is to assist you to help you understand how to avoid foreclosure. I will educate you on how to do a graceful exist.
Defining a short sale
A short sale is a commonly used alternative to foreclosure. Generally, when putting your home on the market, the goal is to market and sell your house for an amount greater than any and all outstanding liens against the property.
If you can no longer afford to make your mortgage payments and your house is worth less than you owe, a short sale allows you to sell your house at the current fair market value. You then have an option to move to a more affordable situation. In a short sale, the investor or owner of your loan must approve the sale because they are entitled to repayment of the loan and will be receiving less than the amount owed.
The Mortgage is a lien and if you have additional liens on your property with other lenders, such as a home equity loan. A second is a lien and you must get approval from that second lienholder as well. All investors must come to an agreement in order to complete the short sale. This process takes time, and you will need to ask your bank if you eligible.
Why should I consider a short sale?
In addition to settling your mortgage debt for less than you owe, you may be eligible for a Relocation Assistance program that will financially help you with moving costs. While not all banks offer relocation, some banks do offer this incentive.
You can also avoid a public eviction notice in the newspaper and sign on your front door. Additionally, you can list and sell your property, allowing you to avoid foreclosure, eviction and a public sale or auction of your house. If you are considering a short sale in any way, please do not hesitate to give us a call at 209-565-4399 or you can leave us a message on the website.
What are the different types of Short Sale Processes or are they all they same?
Typically a short sale is a short sale, but there are different types of short sales offered by different lenders. Banks are working harder at finding alternatives to foreclosure and therefore they will work with their investors that actually own the property to see if there are other short sale options that will match a homeowner’s specific situation.
Keep in mind: Circumstance, hardship, documentation and investor (owner of property) guidelines are key factors. If you are underwater and have a documented hardship, feel free to contact me at (209) 565-4399 for additional questions and/or concerns about how to prevent foreclosure.