short sale help

A short sale is the sale of a real estate property for which the lender is willing to accept less than the amount still owed on the mortgage.

For a sale to be considered a short sale, these two things must be true:

1. The homeowner must be so far behind on payments that they can’t catch up.
2. The housing market must have gone down so much that the house is worth less than the remaining balance on the mortgage.

In most cases, the lender (and the homeowner) will try a short sale process in order to avoid foreclosure.

What are the benefits of a short sale?

• Eliminate or reduce your mortgage debt
• Avoid the negative impact of foreclosure
• May be eligible for relocation assistance in some cases
• Start repairing your credit sooner than if you went through a foreclosure
• May be able to get a Fannie Mae mortgage to purchase a home sooner (in as little as 2 years) than if you went through foreclosure (up to 7 years)

What is the process for a short sale?

The Short Sale process is similar to a normal real estate sales transaction. You will work with your real estate agent to market and sell your home. Your mortgage company will also be working with you and your real estate agent every step of the way to:

• set the sale price (based on current market value),
• collect financial information and negotiate with other lien holders (i.e., your second mortgage company) if applicable,
• review acceptable offers,
• agree to the terms of the sale once a buyer is in place, and
• work with the buyer’s real estate agent and mortgage lender to finalize the sale.

In some cases, you may be eligible to receive relocation assistance to use toward your moving expenses and to make the transition to new housing easier.

A short sale may take up to 120 days, but this could be shorter or longer depending upon your specific situation.

Your mortgage company wants to help you avoid foreclosure and, in most cases is willing to work with you.  

The biggest mistake you can make is to wait any longer to take action.