If you are like many American families who had a reduction in your pay, things can be stressful looking for a way to satisfy the mortgage, car payment, credit card debt and other things.
Maybe you had to re-locate due to your job and are having to make double mortgage payments or a rent payment along with your mortgage. This can be a juggling act andmany find themselves going into default on their home loan and subject to Foreclosure.
Their are other options to Foreclosure that many may not be know that exist. Their are re-payment plans, Loan Modifications and also the Short Sale. This may be an option if all others fail and is far better that having a Foreclosure on your credit report.
You may ask why would the lender want to do a short sale instead of foreclosing on the property ? The answer is that this could be a savings to the lender. It can take 9 Months for a Foreclosure and Real Sale of the home and by the lender allowing the resale it also is a benefit to the borrower as they do not have a foreclosure on the credit and the do not have there name posted in the local news paper. You must submit a short sale package in order to qualify for a short sale.
When you realize it is time to sale your home in leu of a foreclosure, you don't want just any Realtor working for you as many have not ever worked a short sale. These are much different from the traditional real estate transaction. You should hire a Realtor who has experience and is successful working short sales. The entire process involves much more than the average closing and will take longer than the normal 30 to 45 days to close. Once you have an accepted contract on your home, it must them go to your lender for their approval process as well.
You may ask, how does this process actually work ? The listing agent and the home owner will negotiate the offers to get the BEST and HIGHEST possible offer. This is very important as the lender will also verify the value of your home to see if this will actually be a savings to the lender versus preceding with a foreclosure. Remember not to add in any fees that are not normally paid and the lender is not going to allow junk fees, home warranties, repairs to be paid at closing.
Now lets say you have a 2nd Mortgage ( Junior Lien ) This can put a whole new spin on things as we are now negotiating with 2 loan service providers. The junior lean holder does not always want to be as willing to accept less on their loan and often ask for a promissory note to satisfy the debt. They must agree to the short sale as well. If they don't andyour home goes into foreclosure, they loose as well. So in this case something is better than nothing. Once the lenders are acceptable to the short sale, they will sendyou a demand letter that will tell the terms of their approval and this must be submitted to the title company or closing attorney depending on which one is used in your area.
One thing to also keep in mind is that if your lender has already started the foreclosure process, this may continue until you have an acceptable offer on your home. You should always consult with your tax adviser and or attorney about possible tax consequences and legal questions you may have.
Below are links to additional information that will be useful in understanding the process of a short sale
Short Sales - Savings to the Lender
Short Sales - Possible Tax Consequences
Short Sales - Negotiating The Sale
Short Sales - Submitting The Offer
Also, please be sure to read The Short Sale Savior, by Elizabeth Weintraub, available in bookstores everywhere and at Amazon.com. This book has lots of great information and short sale experiences from Realtors who actually work them.
 |
|
|
Roland Woodworth is a Realtor with Exit Realty Clarksville. I assist both buyers and sellers in Clarksville, TN, Ft Campbell, KY, Oak Grove KY and surounding areas with Residential and multi family.
So you want a short sale on your home...
Grandmama's House of Preschool and Child Development opens near Exit 1
Dear home owner.... Do you really want to sell your home ?
Clarksville Tennessee adds additional red light cameras
Short Sales - Possible Tax Consequences
Short Sales - Submitting The Offer
Short Sales - Negotiating The Sale
ActiveRain Corp. is not responsible for the accuracy of the site's content (which is written by members of the ActiveRain Real Estate Network) and does not endorse the views of the real estate agents, mortgage brokers, and others listed here.
Powered by the ActiveRain Real Estate Network
© 2009 ActiveRain Corp. All Rights Reserved
Roland - That is great you make homeowners aware they have choices, and the need competent agents to help them with short sales.
It is so important that these distressed homeowners understand that they have options.
Wendy - Thank You ..... Homeowners need to know they do have choices.
Christine - Youare correct. many don't have a clue what they need to do or can do.
WOW--not this is one 'put-together' post! Glad you finally got it together and didn't lose it this time! This is great information Roland. Sounds like you're definitely Clarksville's expert on Short Sales! Bryant Tutus and Wendy Rulnick are doing a short sale series right now and it is going to be one fantastic seminar. They've had their first 'class' and, if you're interested, they have both been doing these for years and have already answered a few questions that I had, even after doing some of them! Check out their post about it if you're interested on either of their blogs.
Hope you had a wonderful Independence Day and great job on this series!
Good info. The public needs all the info they can get concerning foreclosures.
Roland, Great information and Congratulations on the Feature!!! Sad to hear about Steve McNair tough.
Your building consultant for life in Nashville, TN
Hey, Roland, thanks for the plug. But you forgot to mention that The Short Sale Savior includes a first-person experience penned by none other than the great REALTOR Roland Woodworth in Clarksville, Tennessee.
Debe: THANK YOU !... I feel the 2nd time around was actually better :) I want to check in on the series by BB &Wendy !
Al: Yes.. many have not the first clue
Michael:Thanks you ! #2...
Elizabeth: You are very welcome ! This post was not about me :) THANK YOU for the opportunity to be in your book. I hope sales go throuh the roof !
Roland, great informative post you have here. Thanks for all the info!
Kim: Hopefully this information will be useful to many
Roland, Awesome article! I have bookmarked it. Your knowledge is sure to help anyone in your market with the process!
Very cool post Roland. I am going over to ordfer Elizabeth's book now. Thanks for puutting these resources together for the consumer Roland. They need to know they do not have to be foreclosued on.
Jo: So many are simply willing to give up as many Realtors don't know these options
BB: Thank You ! You will really enjoy her book. Others who are in the book include our very own Active Rain members Erin Attardi, Chris Ann Cleland, Pacita Dimacali, Katrina Gasset, Evelyn Johnston, Wendy Rulnick, Frank Wible and I was also honored to be there too.
Roland this is one excellent post on short sales! You've got it convered from top to bottom. I'll check out Elizabeths book and the workshop as well.
Congrats on the well deserved feature!
Thank You Anna... The book is very good !
What about the loan modification choice? My daughter lost her job and got a new one paying only $9 an hour. She has called trying to get her loan modified. So far no luck. Does anyone know any tricks?
Julie - Some lenders will work with you in these cases under the Obama Home Affordability Program if you talk to the right person. In many cases one has to be behind in their payments to get a loan modification. Of course one would have to Qualify for this.
Roland - You did a wonderful job presenting this information that homeowners need to know and don't realize is out there. So many wait until it's too late to do anything. Congrats on the feature! :)
Donna: Thank You !!! Short Sales is something many Realtors have not the first clue what is involved and many homeowners have never heard of this option. Of course there are the other option as well. Homeowner need to know to ask their lender for these options.
Hopefully many will see this post !
Thank you to all who have commented.. This is information that will be helpful to many home owners.