What is a Short Sale?
A Short Sale is the sale of a home where the proceeds do not fully pay off the existing loan(s), and your lender(s) accepts a discounted payoff to fully satisfy the loan. It is accomplished by providing proper documentation to the lender(s) to convince them to accept less than what is owed and allow the sale without the seller having to come up with funds to cover the shortfall.
Is a Short Sale right for me?
Lenders understand that working with the short sale beats having to go through foreclosure proceedings. It’s less expensive, the home typically stays in better shape, and therefore the end result means that they can recoup more money to satisfy a distressed loan. As you consider the option of pursuing a Short Sale, remember your lender is looking to limit any potential loss on your loan.
By completing a Short Sale, your lender has arrived at a solution that is, for them, much better than a foreclosure.
Who pays closing costs and REALTOR fees in a Short Sale?
Virtually all sales costs, including commissions, title and escrow fees are paid for by your lender. You would in some cases, under HAFA or certain VA and FHA short sale programs actually receive money (up to $3,000) at closing. The resulting loss is accepted in lieu of greater loss through foreclosure.
How do I get started on a Short Sale?
The best way is to contact me directly at 480-540-4552 or email firstname.lastname@example.org or you can fill out and submit the Short Sale Request Form here. It is completely confidential and there is no charge whatsoever. If you decide that doing a short sale is not the best option, no problem.
What type of hardship would my lender consider legitimate?
Typically a short sale file will be reviewed by a few different departments. The more a hardship is clearly stated and demonstrated they higher the success in getting you lenders approval. Generally, so long as the hardship is real and the mortgage company believes the loan is likely to become delinquent as a result, the Short Sale request will be processed by the Loss Mitigation Department. A big key to getting Loss Mitigation to accept a hardship is to submit a strong hardship letter. The hardship letter sets the tone for the entire file.
Here are some examples of “hardships” that are common and frequently accepted by mortgage lenders.
- Family illness or injury
- Illness or injury in the extended family – particularly if it forces relocation
- Job relocation when the property has no, or negative equity
- Job loss or significant income loss
- Divorce or split of domestic partners
- Adjustment in mortgage payment or unforeseen increase in living expenses
Possibly. Some lenders will accept a Short Sale file for approval on loans that are not delinquent. Other lenders will not accept the file until the loan is delinquent. We can put your Short Sale file together within a couple days and submit it for approval. (Remember, there is no charge for this). That is the best way to determine if your lender will accept a file for approval on a loan that is current.
Do lenders approve all Short Sales?
No, which is why it’s important to work with a short sale specialist that has extensive experience and can navigate through the process to get your short sale approved. Simply call me at 480-540-4552 to discuss how we can get started today. I can also be reached via email at email@example.com or you can fill out the Short Sale Request Form below.
I have two loans, can I still do a Short Sale?
Yes. We can work with both lenders (many times the same lender holds the 1st and the 2nd loans) to put together a Short Sale transaction. Even if the value of your home is below the balance of the 1st mortgage, we can normally get the two lenders to cooperate.
Will a Short Sale affect my credit?
Most likely you will experience some effect on your credit; however it is better than foreclosure or bankruptcy. A foreclosure can be the most damaging event your credit status can encounter – worse than bankruptcy. In getting your short sale approved you may miss your mortgage payments, and these will show on your credit. By avoiding foreclosure, you will likely be able to resume normal borrowing (car loans, credit cards, consumer goods and such) relatively quickly.
How long does a Short Sale take?
A short sale can take 60 to 120 days or longer to complete. The process is complicated and often takes a lot of time so you must act quickly especially if you have been notified of foreclosure proceedings.Remember it does not cost you anything to call me and start the process.
Is a Short Sale my only alternative to foreclosure?
Absolutely not, however in most cases it ends up being the best option. Some other alternatives to foreclosure are: Forbearance Agreement, Deed in Lieu of Foreclosure, Renting the Property, Loan Modification, Refinance, etc.
For a no-obligation consultation, call me today at 480.540.4552, complete the Short Sale Request Form below, or email me at firstname.lastname@example.org – I’m here to help!