Are you or anyone that you know behind on your mortgage? Short Sales are an option to take get this huge burden off your back. You can move on to a new life if you have fallen behind on your
Short Sales, a Good Alternative
Are you or anyone that you know behind on your mortgage? Short Sales are an option to take get this huge burden off your back. You can move on to a new life if you have fallen behind on your financial obligations with a Short Sale. What do you do next after you’ve started getting letters of delinquency? Make the decision it's time to sell your home. This is the ideal time to speak with a local Real Estate professional experienced in Short Sales, contact an attorney or a Short Sale company that will assist you in getting the ball rolling.
You're gonna handle it yourself. The odds are against you that you will sell your home at all. Thus wasting more time. What usually happens is delinquent owners are unable to sell their property. Because being late there are fees added on the loan. Extra charges such as legal fees and fees on interest charges, admin charges etc. The lender fees keep adding up once you have fallen behind substantially. The stressed-out delinquent homeowner feels they must sell the property for more than its worth in order to pay off the loan. The owner adds all those extra fees in the price to at least break even. What unfortunately happens is the over-priced house, absolutely nothing.
This can happen when the market values depreciate, especially when the property was highly leveraged to begin with (possibly by the buyers who put very little money down and took out a large mortgage loan).
If an inflated sales price doesn’t make it possible to sell, the fact that the property is probably in less than good condition (due to the owner’s financial difficulties, no upkeep) will probably do the trick of keeping the distressed property just continue to sit.
When the mortgage balance exceeds the value of the property, what many people don’t realize is that the lending institutions can and, in many circumstances, agree to accept less than the outstanding mortgage balance as payment in full. This arrangement is called a SHORT SALE (where the proceeds of the property sale fall short of the amount needed to pay off the mortgage balance).
Even though the property still legally belongs to the delinquent homeowner, this is one circumstance where the lender must be included in the sales negotiations. The situation arises when the owner agrees to sell outstanding mortgage balance. The lender is financially affected by the transaction, so it must be a part of the negotiations and must agree to the Short Sale. The seller must follow the process as the lender requests to complete a successful transaction.
Why does the Short Sale make sense to the lender? In the long run, accepting the lower offer may cost the lender a few thousand dollars, but the initial investment will save the lender many thousands of dollars in the long run. Why? Because if you don’t buy it, the property will be auctioned at the higher price (inflated with back taxes, legal fees, interest, etc.). Since that price exceeds market value, it’s unlikely that anyone will buy at the auction. The property will then become a non-performing asset in the lenders’ portfolio, and the lender will incur all the extra expenses for the upkeep and maintenance of the premises, including property insurance, liability coverage, property taxes, etc. The lender will have to lower the asking price in order to sell it for market value, and ultimately the amount that it will sell for will probably be equal or less than what you originally offered.
Here’s some benefits to the seller if that’s the route you decide to take; the lender/banks will pay the commission fees, sometimes lender may offer a relocation fee to seller in distress, the seller credit will not be as damaged as it would be in a foreclosure. There are certainly emotional advantages to having a Short Sale. However, it would be smart to also speak to an attorney, tax advisor or accountant beAre you or anyone that you know behind on your mortgage? Short Sales are an option to take get this huge burden off your back. You can move on to a new life if you have fallen behind on your financial obligations with a Short Sale.
Being in debt, being stressed out and behind on your obligations is hell. It’s probably worth to look into a Short Sale as an option to get out of the hole that you’re in and be at peace.
I got into the Home Dream profession in 1992 because of my passion for Real Estate. The love of buying, selling, architecture, design, lifestyles, etc...the ability to combine them and the desire to ....
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