What is a short sale, pre-foreclosure, and foreclosure?Â
With the state of our housing marketÂ and rising mortgage delinquencies it's important to discuss short sales and foreclosures. Many people are misinformed and think that a short sales areÂ the same as a pre-foreclosure.
1. Pre-Foreclosure: This is the process during the foreclosure stage where the home has not yet gone to sale or auction. After receiving the Notice of Default (NOD) the homeowner will have approximately 90 days before receiving the Notice of Sale (NTS) which will state the date, time, and location of the auction.
2. Foreclosure: This is the process in which the home becomes the property of the bank. If the home does not sell to the highest bidder during the auction it will be taken back by the foreclosing bank.
3. Short Sale: A short sale is when the bank takes less than what is owed to them. For example, if you owe $350,000 to the bank but the home is only worth $300,000 the bank will need to take a $50,000 loss by allowing your short sale to go through. Thus, not all sellers or homes qualify for a short sale. If the banks see that they will mitigate more loss by going through the foreclosure process they will not approve the short sale.
Notice of Default (NOD): Given to the homeowner after they've been more than 60 days late on their mortgage.
Notice of Sale (NTS): Given to homeowner 90 days after the NOD announcing the sale date, time, and location.
If you would like more informaiton you can visit www.lahousingreport.com
or visit www.hopeforseller.com
. to download a FREE report on how to avoid foreclosure.