A short sale is when a homeowner owes more on a property than it is currently worth. A homeowner is “Short” when a borrower owes an amount on his property that when combined with closing costs and commission is higher than current market value. Therefore, a “SHORT SALE” occurs when a negotiation is entered into with the homeowner’s mortgage company or companies to accept less than the full balance of the loan at closing. A buyer closes on the property and the property is “sold short”.
YOU ARE NOT ALONE!!!
Many Americans are facing the distress in their finances and their property. In some areas as many as 1 out of every 10 homes are at some stage of the foreclosure process. Today, Colorado’s foreclosure rate is 1 in 33 homes and growing monthly. Be sure you have someone that has the knowledge to deal with the complex situation of a short sale.
A Lender who accepts!
A lender who accepts a short sale is liable to pursue the borrower for the difference unless stated otherwise in the approval letter or they are eligible to file tax form 982 which allows for a one time relief of debt. We will review al of this before the closing, Delroy Gill has been successful in getting our short sales approved without promissory notes. Delroy recommends seeking legal and financial advice from a qualified lawyer and accountant. We are not qualified to give answers to any tax or legal actions but we will do our best answer to point you in the right direction.
Another key thing to remember in short sale negotiation is that you're going to need some patience. Negotiating with the banks can take four to eight months which is getting better day by day as mortgage companies are becoming more aware that Short Sales are saving them money. There are a few variables a short sale in real estate depends on:
- The current real estate market
- The financial situation of the individual borrower
We Do the Work!
Your Hope Team will negotiate your short sale with the bank. You don't have to do it yourself. Your Hope Team specializes in this so that you're spending your time getting back on your feet right sooner rather than later. The short sale negotiation process is much easier when experienced negotiators work with the banks for you.
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KNOW THE FACTS!!
A short sale in real estate is a way out of filing bankruptcy or foreclosing on a property a homeowner can no longer afford. Enter the process of short sale negotiation, in which a homeowner is able to sell the house at a lower price and pay off a smaller loan balance. This results in huge discounts on mortgages for real estate investors. When a lender forgives some portion of the debt left on a mortgage, you can hack that amount off the total cost of a home. A Short sale negotiation of a home is tricky, but if you know the facts it is a whole new possibility that can be explored. It's probably not as hard as you think.
The Reasons Why
The short sale negotiation of a home mortgage is an alternative to foreclosure or bankruptcy used by those who have reached a point where they can no longer make monthly mortgage payments. Maybe the reason is job loss, loss of income, or increasing bills and more. The lender is then put into in a place where he can accept less than the total amount due on the mortgage, likely because the local real estate market is less than healthy. A market with falling home prices will be ripe for the short sales of homes.