What is a Short Sale?
THERE IS NO COST TO YOU when selling your property as a short sale!
In April 2008 it was reported that 63% of all pending real estate sales in San Diego were shorts sales.
A short sale is when a mortgage lender agrees to accept less than the balance owed during the sale of a home. Extenuating circumstances influence whether or not banks will discount a loan balance. These circumstances are usually related to the current real estate market and the borrower’s financial situation.
The short sale process typically is executed to prevent a home foreclosure, but the decision to proceed with a short sale is determined by the most economic way for the bank to recover what is owed on the property. Often a bank will allow a short sale if they believe that it will result in a smaller financial loss with foreclosure.
In order for a short sale to be started, the homeowner must prove a hardship situation to the lender in writing. Other things the lender will require includes: 2 years of tax returns, a detailed financial worksheet, bank statements, pay stubs and a few more items documenting a sellers assets or in many cases - no assets.
While short sales negatively affect a person’s credit report, the impact is typically less than a foreclosure; short sales are considered a type of settlement. Like all credit report entries except for bankruptcy, short sales can remain on a credit report for up to seven years. The positive news is that the opportunity to obtain a new loan in the future occurs within a shorter time period than with a traditional foreclosure.
Experienced REALTORS® can help protect your interests, guide you through each step, check important details, and provide sound advice. We have a full-time staff dedicated to negotiating short sales with over 80 successful approvals in just the past 36 months!
