Home Selling in 27587>Question Details

Ginn78, Home Seller in 27587

My husband and I bought our house 2 years ago. We now need to move back to our home state. We are current

Asked by Ginn78, 27587 Wed Jul 8, 2009

on all bills and taxes. We do have money in a 401k. The problem is we owe more on the house than we can sell it for, about $40,000. What are our options? I've heard the term short sale, but don't know if we would qualify. We don't have the $40,000 to bring to closing.

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As mentioned by Carisa, the bank will not usually consider a short sale unless your payments are past due. However, since you are current and if they are willing to work with you, you may be able to get through a short sale with out as major of a hit on your credit report. You should also consider the tax implications of a short sale as well. My advice would be to try and rent or 'lease to own' as Carisa stated. You might check some of these web sites for alternatives: http://www.FHA.gov, http://www.HopeNow.com or http://www.HUD.gov
Good luck!

Jason Ewing, GRI/CNS
Coldwell Banker Triad, Realtors
1 vote Thank Flag Link Wed Jul 8, 2009
Loan Modifications and Short Sales are best addressed by professionals. The processes are similiar. There are approved companies thru HUD. I suggest you visit their website Hud.gov

Committed to Your Success !!

Web Reference: http://www.JeffDicks.com
0 votes Thank Flag Link Thu Jul 16, 2009
Since you are not in a hardship situation, it would be best to rent the house for awhile. If your home is in Wake Forest, I can not imagine it is worth $40,000 less than what you paid for it. Call me. Let's talk.
919-931-0260 Cheryl Wilder, Coldwell Banker Advantage, Wake Forest, NC
Web Reference: http://cherylwilder.com
0 votes Thank Flag Link Wed Jul 8, 2009
I would like to thank Keith for proving my point that most Realtors need more education when it comes to short sales. Your post says you need to move back to your home state, without elaboration. That typically goes with some sort of financial hardship e.g. you lost your job here, there is a family medical situation or you need to move for work all of which would need to be investigated before anyone can come to a conclusion about your financial hardship. I have qualified many of those situations as a hardship and gotten the short sale approved. You mention money in a 401K, and those funds are normally not considered by lenders in determining whether to allow a short sale. I have one short sale for an investor where his hardship is that the negative cash flow on the rental is burden, and I am getting that approved. Yet, you get some Realtors who incorrectly tell you that you have to miss payments and others who say you do not qualify for a hardship. Now you know why I have been called to teach this material and why my book Create A Short Sale, Your Guide Through the Short Sale Maze comes out this month. I would rather spend my time doing my other real estate business as it is more profitable, but there is a large need for education in this field. You need help, and you need educated Realtors to give you that help. The banks need educated Realtors to do more short sales, so that they can get the average of 30% more for the property than a foreclosure and better results than a loan modification. The neighborhoods need educated Realtors who will properly do short sales and preserve the property values. Yes, you should consider renting it as one of the options, but you should be given all of the options and proper consideration of your qualification for a short sale.
0 votes Thank Flag Link Wed Jul 8, 2009
Short sales normally require a hardship, and you do not have one.

There are many people in your situation.

Either stay put, or move and rent it out. Caution, talk with your CPA regarding the tax implications while it is an active rental property and what happens when you sell.

This could be a good thing for you. See my profile.
0 votes Thank Flag Link Wed Jul 8, 2009
Keith Sorem, Real Estate Pro in Glendale, CA
I teach the class approved by the North Carolina Real Estate Commission on Short Sales, called the Comprehensive Short Sale Seminar. You will need to show a hardship that has changed your financial situation. The fact that you need to move for business may work. Other than that, it appears the short sale would work, but you need to know the disadvantages of a short sale before you proceed.

It is not correct that you have to be behind on your payments to the bank. I have done a large number of short sales in the last few months where the payments are current, and the sale has closed without the seller missing a payment. I can explain the reasons why you would want to keep your payments current.

If you want get an encyclopedia of information on short sales, go to http://www.CreateAShortSale.com . You will get a full guide to the process.

Feel free to give me a call at 919-812-5111 or email tim@TimBurrell.com . As you can see from the answers, there is a wide range of experience and understanding of short sales. You deserve someone who has been doing them since 1992 and who teaches the other Realtors to do them because there are a large number of pitfalls to the process that you need to understand before you proceed. I will tell you all the advantages, and all the reasons you would not want to do it, because you need a counselor who will put your best interest ahead of whether they make a commission or not.

Good luck.
Web Reference: http://www.ShortSalesR.us
0 votes Thank Flag Link Wed Jul 8, 2009
Dear homeowner,

Every situation is very different so it is hard to give you a general answer to your question. I can say this though, you do have options. Selling your home as a "short sale," is one of the options. The first step to qualifying for this is to contact your bank (or banks if you have multiple loans on the property), let them know that you need to sell your home and that you will be "short" on the payoff amount due to the value of your home depreciating over the last few years. They will most likely direct you to their website where there is an application to complete for selling your property. There will also be a list of documents they will request in addition to your application that will help them evaluate your financial situation. A loss mitigation negotiator will be assigned to your file. Once you have an executed Purchase and Sale agreement on your home, the negotiator will then process your request for a short sale.
If you decide to go this route, be sure to work with a Listing Agent who is experienced in Short Sales. The Listing Agent will be the person working on your behalf to get your short sale approved. They will need to work many many hours pushing your contract through, as well as keeping the buyers informed and hopefully on board with waiting for bank approval. Short sales typically take 2-3 months to process once you have a contract.

There are many more details to answering your question...but hopefully this helps get you started. If you would like to talk directly with me about this, please feel free to call or email me. 770-596-5965 or Melanie@TheGurleyTeam.com.

Best wishes to you. Please know that you are not alone, most sellers today are facing these same difficult questions.
0 votes Thank Flag Link Wed Jul 8, 2009

Our office specializes in working with Short Sale clients and would be happy to answer any of your questions. Each situation is different and each bank has their own terms. Please feel free to contact me trhough Trulia or call to discuss your specific situation.
0 votes Thank Flag Link Wed Jul 8, 2009
Usually a home owner must be behind on payments before the mortgage company will consider a short sale. However I suggest you call your mortgage company anyway and see how much they are willing to work with you. You can arm yourself with a market analysis from a Real Estate Broker or even get an appraisal done though the bank will probably want to order their own.
You may also want to consider leasing the property. Offering the property on a "Rent to Own" basis may attract better lease clients and you have some hope of a sale in the future.
Hope this helps.
0 votes Thank Flag Link Wed Jul 8, 2009
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