Information on Short Selling Your Home - Greenacres
While short selling your home is not the easiest way to sell your home it can become a lot easier by using the services of a professional. Over the next paragraphs, we will give you an overview of the process.
A short sale is a distress sale in which the owner owes more on the mortgage than the property is worth. The sale of the property is contingent upon the seller gaining approval from their loan servicer or lender to sell the property at about current market value.
When attempting to short sale your home there are two very important tasks when you get started. First, select a real estate agent who has an experienced short sale team and who will not charge you a fee for negotiating the short sale with the bank. That real estate professional should provide you with a detailed pricing report. The second thing for you to do, is to contact your bank and let them know what you are planning.
At this point you will receive a hardship package from the lender. In it you will need to disclose your financial situation and explain why you should be allowed to short sale your home. Your real estate agent’s team should assist you in completing the documents. Hopefully, you will receive an offer to purchase your home. That offer will be submitted to your bank by your real estate professional along with the hardship package.
The lender has a number of choices when reviewing the offer that is submitted by the seller. They can either agree and accept the loss, agree and make the seller/borrower repay the debt or part of it, or deny the short sale altogether and simply foreclose. The short sale process has many moving parts. The lender, borrower, buyer, investor, mortgage insurance company, escrow and real estate agents all need to work together and agree to specific terms in order to successfully close a short sale transaction.
These days, short sales take approximately 60 days from the time the offer is presented to close. Be prepared to move during that time frame.
Who Qualifies For A Short Sale
| 1. Have comparable homes in your zip code sold for less than your mortgage balance? | YES NO |
| 2. Are there ten or more homes in any foreclosure category, in your zip code? | YES NO |
| 3. Does your State allow a lender to take a deficiency judgment? | YES NO |
| 4. Do you have limited savings, excluding retirement accounts? | YES NO |
| 5. Has your income recently declined? | YES NO |
IF YOU ANSWERED YES TO ANY OF THESE QUESTIONS…
You may be great candidate for a short sale!
These questions are merely guidelines in deciding whether a short sale is right for you. In fact, even if homes around you have sold for more than your mortgage balance(s), but the net proceeds of the sale are less than your mortgage balance(s), then you may still be a good candidate. You can calculate this by deducting a 5% real estate commission and another 2% for sales costs. You should pursue a short sale to save yourself from further economic damage, beyond the loss of your home.
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