Short Sales: Real Estate Escape Hatch for
A short sale is a strategy for selling your home when your mortgage balance is more than your home is worth. A dramatic and prolonged drop in property values, rampant unemployment, and other financial problems have many Americans at their breaking point. If this describes you, a short sale may be the answer to your problems.
Short Sales Defined
A short sale is nothing more than a lender agreeing to allow the sale of a home for less than the current mortgage balance. This method of selling a home isn’t good for everyone, but depending upon your specific situation, it could help you to sell your home and free you of the stress of going through the foreclosure process.
A successful short sale transaction requires a number of conditions to be met. If you meet the following conditions, a short sale might be a good solution for you.
Recipe for a Successful Short Sale Transaction
- Negative Equity
- Strong Seller Motivation
- Financial Trouble
- Lender Agreement
- Real Estate Agent Involvement
- Qualified Buyer
While a short sale transaction won’t offer you financial gains, it can do a number of things for you that can make it an attractive alternative to foreclosure:
- Allows you the freedom to sell your home and move on with your life
- Helps to avoid the personal, spiritual, and societal stigma attached to foreclosure
- Can minimize potential credit damage compared to foreclosure
While a short sale can be good for you, this transaction can also be good for your lender:
- Eliminates the financial implications of a protracted foreclosure process
- Gets “bad loans” off the books, which improves the lender’s financial situation
- Eliminates the potential for vandalism, maintenance costs, and other expenses associated with carrying a non-performing asset
Short Sales Aren’t for Everyone
A short sale may be a good solution for you if you owe more on your home than it is worth and you are experiencing serious financial problems due to changes in your employment situation, health problems, or any one of a number of different reasons. They do, however have some drawbacks that must be carefully weighed in light of your specific circumstances:
- Potential for tax liability for any forgiven debt
- Possible deficiency balance for the difference between your loan balance and the amount accepted by your lender in the short sale
- Credit damage as a result of a short sale and ineligibility for federal housing-related lending programs for two years (versus four years in a foreclosure)
Selecting the Best Real Estate
Professional for Your Short Sale
A major factor to consider when thinking of foreclosure avoidance with a short sale is the the qualifications of the real estate professional with whom you choose to work. All real estate professionals are not created equal. Because a short sale transaction involves multiple communications with your lender in order to complete the short sale process, it’s imperative that your real estate professional be trustworthy, experienced in short sales, and willing to keep you informed with regular updates.
Deciding whether or not a short sale is the best foreclosure alternative for you and your family is a big decision – with major implications for your future. Only you can decide which foreclosure avoidance strategy is best for you. Armed with the right tools you can make the right decision.
This Property has some Incredible History of Tucson behind it. The Old Round Up Steakhouse is No More BUT The land and memories will forever be. Buy a piece of the Old W...
- Courtesy ofOmni Homes International
sprawling 280 degree view of the east end of the Saguaro Natl. Forest and the Rincon Mtn. Wilderness. 3.49 Acres, all useable, flat, fenced and walled yard. Three separat...
- Courtesy ofLong Realty Company
Hilltop home on over an acre with incredible mountain views. Split plan with high ceilings, courtyard entry, wood beamed ceilings and more. Nice great room with corner fi...
- Courtesy ofHomes, Land & Rentals
Beautiful 3 bedroom + den/office, 2.5 bathroom custom home in private area with panoramic views and access to Catalina State Regional Park and National Forest. Horse prop...
- Courtesy ofTierra Antigua Realty, Llc
Views! Views! Views! This custom home in Catalina is more views than the eye can see. This home features 3 Bedroom 3 Bathrooms, 2.5 Car garage, Basement, balconies & pati...
- Courtesy ofNexthome Complete Realty