What is a Short Sale?!?!?!
Â Â Â I am sure you must have heard someone mention a Short Sale in this past year. It is no wonder with the economy as it is, many people are losing their homes. Rather than going into foreclosure, many have opted for the short sale approach.
Â Â Â What is a short sale? It is when someone can only sell their house for less than what they owe on the property. What causes a person to fall short? Often times a family suffers from some sort of hardship; loss of job, illness, death, divorce, and many other unforeseen events.
Â Â Â People do not want to fall short but with the economy; and real estate market having turned, it often happens to people who have never before missed a mortgage payment. My heart goes out to them; after all it could be anyone of us, who has a sudden turn of events that could cause to walk in their shoes.
Â Â Â What do you do if you find yourself unable to afford your home? The first thing I always recommend is that you request a loan modification, or refinance from your bank. Some banks would rather lose a little in the interest payments, and still keep a customer in their home. Contrary to what many people might think, banks do NOT want to foreclose and become the owner of homes. They become vacant, damaged, and still have a cost associated with holding them.
Â Â Â If your bank will not give you a remobilization then the short sale route is a better option than foreclosure. It has less effect on your pride, credit, and finances. When you are foreclosed on, the bank can then sell the home. If they do not get a sufficient amount to cover the loan amount they can come after you with a deficiency judgment and make you responsible for the difference!
Â Â Â When negotiating a short sale however, I negotiate that the deficiency be forgiven. You will walk away from the home; without making any money, but it will not cost you anything either.
Â Â Â Negotiating a short sale is not something you want to do yourself. It is essential that a professional does it on your behalf.Â Not only do we have experience, but we also have inside contacts, and a few tricks up our sleeves. You do not pay us for this service and be very concerned if some asks you to pay them for this service!
Â Â Â After collecting some documentation from you, we put the home on the market, get it to contract, and then begin our work with the bank(s). At this point you just have to worry about finding a new place to move into. We can help you with that as well. After the bank approves the short sale the closing usually takes place rather quickly (within a month). It is best to have us pull your credit and find you a new place before the home is even under contract. We are paid by the bank, as is the attorney who handles the closing on your behalf. That is all part of our job to negotiate with the bank. The entire process takes an average of three months, although I have negotiated many within a monthâ€™s time. So after our first meeting, start packing!
Â Â Â After the closing, we wire the funds to your bank and they release the loan on your home. Title transfers to the new owners and you can sleep tight for the first time in a long time! For more information feel free to call us at #203-287-7550 ask for the Broker (Debbie)