Understanding short sales

If you or someone you know is facing financially difficulty with paying their mortgage or if your property, no longer holds its value due to today’s economic shift and/or current real estate prices – you may want to strongly consider doing a short sale. Short sales are a solid, sensible option for homeowners to take instead of foreclosing or “letting a property go”.

A short sale is where the seller’s lender agrees to accept less than the full amount owned. In most instances the seller is often forgiven of any payment deficit and is no longer responsible for paying the difference.

Short sale benefits for sellers

  • Avoid the stigma of foreclosure
  • Reduce the hit to your credit score
  • Short sales can be repaired/ removed from your credit score over time; foreclosures often cannot be removed from your credit report.
  • Avoid a deficiency judgment – if you go into foreclosure, your mortgage company may file against you in court to collect payment by issuing a judgment against you. Short sales often relieve sellers from owing any additional money to the bank(s).

Contact us today to discuss your situation. A-List Realty can help you with your short sale transaction.

Short sale FAQ’s

The answer is no. Lenders are looking for verifiable hardship, monthly cash flow shortfall, or pending shortfall and insolvency.
If you meet these three requirements and believe that you soon may be unable to afford your mortgage, act immediately to discuss short sale options. Any delay could limit your options.

Foreclosure is a process that takes time, it is highly likely that you have time to make decisions that may result in a better outcome. Often a lender can stall a foreclosure up to the final day of the process.

The majority of short sales are approved based on the sellers’ financial hardship and on circumstances beyond the sellers’ control – this hardship needs to be documented. If you have assets and disposable income, don’t expect to walk away with an approved short sale and no contribution towards your debt.

Yes. A property owner can authorize their realtor to initiate the short sale process on their behalf. The property owner will need to draft a letter stating they allow the lender to discuss their account with their named realtor. The property owner will also need to give a copy of their mortgage statement to their relator; all information will be discussed with during a consultation with your realtor.
 

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