Home Selling in 22304>Question Details

d-lcrawford, Home Seller in Seattle, WA

We put our house on the market a month and a half ago. After lowering the price just once, our agent wants to change to a short sale. Must we comply?

Asked by d-lcrawford, Seattle, WA Fri Feb 21, 2014

It is scheduled for a foreclosure sale in less than two months. We'd rather live our lives in peace until then and let the bank take the darn thing back at this point.

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Depressed in Seattle, ------ The choice to comply or not is really not yours to make. This is determined by the price at which the home sell, the balance of the mortgage, the assets you possess and if this in your primary residence. -------------- Living your life in peace and allowing the bank to foreclose and give them the ability to sell the rights to collect that unpaid debt to an asset recover company will not result in 'live our lives in peace." Depending on the laws in the state of Washington, you may want to reconsider the passive approach. In FL, the owner who does nothing has 17 years of financial purgatory to anticipate.In the state of Washington, the bank may have NO RIGHTS that endure beyond the foreclosure. ------------ Have a heart to heart with your Realtor regarding the mechanics of a short sale and the benefit this brings you. It is more than likely a short sale solution can maintain your peace and quite and when the time comes, to execute the sale rapidly, depending who holds your mortgage. If you agent has experience in distressed property sales, he/she can suggest the variety of options and the most likely outcomes. -------- REMEMBER------ the purpose is to remove the uncertainty from the process. Don't second guess your agent and remind yourself of the objective frequently......and save some money! Best of success.
2 votes Thank Flag Link Fri Feb 21, 2014
A foreclosure is generally the worst outcome. It may alleviate some current distress, but you'll live with the consequences and added stress for longer. The right answer may or may not be a short sale. I have all my clients do a consultation with an attorney who lays out the options, short sale, bankruptcy, foreclosure, loan modification, just to name a few. Forestalling a foreclosure in Washington is not uncommon or difficult and can buy you time to resolve many issues.
Contact me and I'll forward my attorney's information for a reasonable priced consultation (they have even provided free ones at times) to see what is best for you.
Dan Tabit
Northstone Real Estate inc.
425-868-Sold, DanTabit@Northstone.net
1 vote Thank Flag Link Fri Feb 21, 2014
It address your actual question; "Must we comply?" No, you do not have to change it to a short sale. First, if your home has only been on the market a month and half ago and the realtor is already suggesting you short sale, there's something wrong. The property should have been priced right to begin with. Also, to go from a single price reduction to a short sale is absurd in such a short amount of time. Unless of course the realtor advised you from the beginning that the house was being listed at a 'bargain' and that if you get no bites you might try a price reduction and that if that did not work then you might have to short sell, then the realtor might have a leg to stand on. A good realtor would now in advance if they have a property on their hands that could likely require a short sale, and should have advised you of that prior to taking the listing. I'd make your realtor do their job.
0 votes Thank Flag Link Mon Aug 18, 2014
im so sorry to hear, where is this house located?
0 votes Thank Flag Link Tue Mar 18, 2014
The home should have been priced right for a quick sale from the start, there is no time to play the "reduce by a little game" It will depend what your house is worth in todays market and what you owe. A short sale is much better on your credit which may affect you 1 to 3 years. A foreclosure could affect you 7 to 10 years. Credit is used for everything these days and you should do what you can to protect it
0 votes Thank Flag Link Tue Mar 18, 2014
It's up to you but realize that a foreclosure is going to significantly impact your credit score and lives in a negative way for several years, if you can possibly avoid this you should. You need to speak to an attorney who specializes in real estate so that you understand your options. It sounds to me as if your Realtor is trying to give you the best advice that they can, but Sellers must be approved by the lender for a short sale to occur and at least 50% are not. Ultimately it up to you, but I'd really suggest sitting down with an attorney quickly so you have the information necessary to make an informed decision.
0 votes Thank Flag Link Tue Mar 18, 2014
It's probably good advice, generally, to consider a short sale. However, because you say "We'd rather live our lives in peace until then and let the bank take the darn thing back at this point"--if that's really how you feel and you're confident that'll remain your position--then let it go to foreclosure.

In no case do you have to comply.

One thing you might consider is a deed in lieu of foreclosure. You essentially give the house to the bank without the mess of foreclosure proceedings. It may not be quite as damaging to your credit, too.

Make sure you're comfortable with your decision, whatever it is. Then stick to your guns.

Hope that helps.
0 votes Thank Flag Link Tue Mar 18, 2014
Don Tepper, Real Estate Pro in Burke, VA
You don't have to comply with anything, but there are consequences to your choice. A foreclosure will be a bad mark on your credit history for years to come. A foreclosure will make it much harder for you to find a landlord willing to rent to you. A short sale could mean that you are in your home for much longer while you wait for the short sale to process.
0 votes Thank Flag Link Tue Mar 18, 2014
By the time your home is 1-2 months away from foreclosure I think you have most likely experienced some financial challenges long before. You have probably considered refinancing, loan mod, renting out, for sale by owner, etc. but non of those had worked. Your credit has taken a dent already from the late payments, so the late mortgage still affect your ability to obtain loans in the short term future.

(Check http://www.WorldsBestCredit.com to get your credit repaired by yourself.)

There have to be some reason your house is not selling as a regular listed sale. It may be just a slow market in your area, the asking price above the similar homes, house has deferred maintenance or other defects and it is less desirable to financed home buyers...

An experienced agent will put the house on market for just long enough to show the bank that it is not selling as-is, at certain price point. Then they will approach the bank and propose ways to mitigate loss for the bank by doing a short-sale because foreclosure damages the bank as well as for you. Once the bank agrees to try the short-sale route, you actually have more time to keep the house until it gets sold or the bank decides to not wait on short-sale any longer. Your agent would rather sell it for less than to lose the sale to foreclosure, because they will not get any commission.

So, it's not a bad option to avoid foreclosure by doing short-sale, at least for now.

I buy houses that need work, so if your house needs some rehab, have your agent contact me.
0 votes Thank Flag Link Mon Mar 17, 2014
Good Morning,

It may be wise to consider a short sale if you can't sell your home at this point, either that or a refinance/modification. The reason is that most lenders will require that you wait 3-7 years after a foreclosure before they will consider you for a loan. It might not sounds like a lot of time, but paying rent on someone else's property for 3-7 years, especially in an environment of rising home prices, could set you back significantly. If you live with someone else, and both of you are on the loan that is foreclosing, you may want to consider some other options.
0 votes Thank Flag Link Tue Mar 4, 2014

I understand how you can feel. Faced with uncertainty can be daunting. At some point, the lender will have to step in if you are in default. Talk with the bank to see what are your options. A short sale is not necessarily a bad thing especially if you want to be done with it and move on.

Diana Watson
Avery-Hess, Realtors
0 votes Thank Flag Link Tue Mar 4, 2014
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