Going Through the Short Sale Process
Homeowners are defaulting on their mortgages at a record pass during the past couple years and many are requesting from their bank or lender for some type of assistance to prevent going into foreclosure. Many borrowers are taking the route of selling their home via a “short sale”, which is an alternative worth considering to resolve mortgage debt with the lender on a property that is no longer affordable to you.
Before starting the short sale process, make sure to look over the basics:
What is a short sale?
A short sale is when a borrower finds that their property is now worth less than what is owed on the mortgage. When approved, the lender or bank will move forward with the short sale by accepting less than what is due on the mortgage(s).
Why is it an option?
Foreclosures carry a hefty price tag for banks and lenders to process. Including documents, attorney and many other fees, most of the time a short sale is a cheaper option for the bank to settle the issue. Banks can face fees upwards of $50,000 to $60,000 when foreclosing on a property.
How does the short sale process work?
Many lenders have a short sale package that must be filled out and completed in order for the short sale to be approved. Additional documents could include:
Once the short sale package has been delivered to the bank or lender, a negotiator is assigned to your file and will be your contact going forward.
Points to Remember:
-Don’t expect to close immediately after finding a buyer. It make 60 days or longer to close or get a response from the lender.
-Lenders are overwhelmed with short sale requests and may not have the staff to help you quickly. Be persistent so that you are not forgotten!
-Consult with an attorney and real estate agent on the short sale process. They will be able to help your specific needs.
Tags: foreclosure, foreclosures, hardship letter, hefty price tag, mortgage debt, mortgages, settlement statement