Home Selling in 08861>Question Details

Rguevara, Home Seller in 08861

Hello, I am thinking about selling my home but I'm concerned with the market right now. My house is worth $240,000, my question is, if the house

Asked by Rguevara, 08861 Thu Oct 29, 2009

sells for less then what its worth will I still owe the bank for the remaining amount?

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11
Debra (Debbie) Rose’s answer
Hello Rguevara.............

To keep this simple, so that you're not overwhelmed by all this information............yes.............you will still owe the bank the balance of the amount you originally borrowed. It doesn't matter how much you sell the house for - the bank wants to be repaid.

If you sell for less than you owe, you will be expected to come up with the difference.

If you can't do that.....If you have a hardship......you may qualify for what is referred to as a "short sale".
I suggest you call and speak with someone from the bank or mortgage company to see where you stand......they will sit down with you, and explain your options.

Best wishes...........
Debbie Rose
Prudential NJ Properties
2 votes Thank Flag Link Thu Oct 29, 2009
I would add to Debbie's answer that a consultation with an attorney with signficant short sale experience may be in order. When I list short sales I encourage the seller to qualify their situation and use the services of such an attorney to negotiate with the bank. Short sales can be complicated and working with resources that know the ropes is hugely helpful to you and to a successful outcome. If you need the name of an attorney - send me a quick email and I will be happy to provide her contact info to you.

Best,
Jeanne Feenick
Unwavering Commitment to Service, Unsurpassed Results
0 votes Thank Flag Link Mon Mar 26, 2012
You can contact a mortgage company they may have an Attorney who can speak to your bank about your particular situation or hardship. If they get an approval to sell for less than you owe due to current market conditions then you can sell short sale listing the house with a Real Estate Agent.
Best Regards
Daniel Gomez
0 votes Thank Flag Link Sat Mar 24, 2012
Concise and to the point - nicely answered Deb. If you find yourself considering a short sale, consider hiring attorney to help you negotiate with the bank.

Good luck to you,
Jeanne Feenick
Unwavering Commitment to Service
Web Reference: http://www.feenick.com
0 votes Thank Flag Link Fri Jul 29, 2011
You won’t have to pay the difference at all. If you purchased for $240K and it’s worth $145K now no need to worry. The bank will gladly waive the $95K you owe no problem. It’s possible to call the bank and ask if you can own the home free and clear why pay the mortgage now. The bank might even toss in all expenses paid vacation for a week to South beach Miami.

Good luck out there.
0 votes Thank Flag Link Thu Jul 28, 2011
I would keep a positive approach! Bring in a few real estate professionals to give you their opinion of it's current value. See if this is even an issue yet! Yes, you would owe the bank if you come up short, however you could approach the bank for a short sale. I would seriously consider interviewing a few agents that can walk you through this process! If you would like me to recommend someone in your area feel free to call or email anytime. For more real estate advice visit: http://www.RochesterHomeLocator.com
-Sal Salafia
585-279-8217
sal@salafiasoldteam.com
http://www.Rochesterhomelocator.com
http://www.FindRochester.com
0 votes Thank Flag Link Sat Jan 29, 2011
Start by talking to your bank. They may be willing to work out a short sale. Not as easy process, but possible.
It can wreck your credit, but you could possibly end up owing nothing to the bahk.
0 votes Thank Flag Link Thu Jan 27, 2011
Rg,

I wish there was a straight answer for this question because it would make my job much easier. Some backs are forgiving the difference, yet providing the sellers with a 1099 for the difference in selling price . . . therefore, the deficit in selling price is considered income for the year and you will need to claim it on your income taxes, while others are requiring sellers to pay back the difference. From what I understand, the bank's decision on how to handle any individual's situation is conditional upon the circumstances . . . which makes this even more confusing to us all!

What you reallty need to do is consult with your Bank. At a minimum, I would give an anonymous call a try . . . . . don;t tell them who you are but expalin your circustances and see if they will provicde you with even an inkling of sound advise (which I doubt), but at least you may get a perspective on how how flexible they may be. I most recently dealt with a bank that floored me in their cooperation/understanding of my client's situation.

Love and Peace,
Francesca, ePro, SRES
Francesca@PatrizioRE.com
Web Reference: http://www.PatrizioRE.com
0 votes Thank Flag Link Thu Oct 29, 2009
Ragu

Yes, You can talk to your bank and see whether they can agree for short sale.

Regards
Devkumar
Keller Williams Realty
732-322-7255.
dev@devrealtor.com
Web Reference: http://www.devrealtor.com
0 votes Thank Flag Link Thu Oct 29, 2009
It sounds as if you may have a mortgage high enough that if you don't get your price, you will have to bring money to the closing, making it a short sale? If so, yes -- you do have to pay off your mortgage. What is the basis that you used to determine the value? Generally, you should look at sales and under contract in the last three months, and how long those homes stayed on the market to get what they got, and how yours compares to theirs, in terms of upgrades, location, and style. I strongly suggst that you meet with a realtor to get a market valuation for your home, and add some cushioning in case you don't get your price. Don't forget realtor commission, any liens or second mortgages, taxes due, etc. If it's really close, speak with your attorney to determine next steps on what your options are with the bank. If, after your review you decide you will be in a position where you owe money or cannot close, and you can afford to stay where you are, that may be an option. Since I don't know your situation, it's hard for me to judge the best route to take. Best of luck.

Found this information by googling short sale to get you a summary. Found this on shortsalehelp.com. I am not affiliated with them, but they seemed to summarize my take on the situation:

•Figure out the true value of your property. Many times a real estate agent can provide a 'market analysis' and give you a good idea of what your home might sell for. You can also use Zillow or other real estate related sites to determine the rough value of your home. If the market is moving down keep in mind that your homes value may be moving down as well and estimated valuations may be valid for only a short time.

•You also need to calculate your estimated closing costs. Items such as a title report, escrow, appraisal, attorney fees, agent commissions, unpaid property taxes etc. may add up to a substantial amount of money.

•You'll need to know how much you owe on your property. Include all loans on the property in your calculation.

•Calculate your equity. Normally the value of your home is more than the total of the loans and closing costs. If your closing cost estimate plus your loan amounts are higher than the value of your property then a short sale is a possibility.

Home sellers should consider a Short Sale when the value of their home is LESS than the amount of their outstanding loans. For example, if your home is worth $250,000 but you have a loan of $260,000 then a short sale is a consideration. Obviously, if you do not have to sell your home, you could wait out the market and hope for a turnaround in real estate values.

However, if you do have to sell your home you basically have three options. First, you can bring cash to the table. In the example above you would sell your home for $250,000 and pay another $10,000 to the lender out of your pocket to pay off the loan on your property. Second, you could let the home go into foreclosure. The lender will go through the foreclosure process, force you out of your home and then auction it off to the highest bidder at a foreclosure or Trustee's auction. The third option is to pursue a short sale. You contact the lender, explain the circumstances and convince them to take less than full value of their loan.

In the case above you may tell them you have a buyer for $250,000 and it's very unlikely there will be a buyer at a higher price. If they will accept $250,000 for their $260,000 loan then you can proceed with a short sale. Sometimes the lender will consider a short sale before you have a buyer and you can market your property and, if you find a buyer, take their offer to the lender for consideration. The lender may or may not accept the offer
0 votes Thank Flag Link Thu Oct 29, 2009
Hello:

Yes you would still owe your mortgage company for the remaining amount unless you have some type of hardship. You can then speak with your mortgage company and proceed with a short sale. You would first need to speak with your mortgage company and they will let you know the paperwork they require to see if they will approve a short sale on your property. I hope that helps.

Thank you,
Gina Fagnani
Realtor Associate
Century 21 Hearst Realty
GinaFagnani@aol.com
0 votes Thank Flag Link Thu Oct 29, 2009
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