First and foremost homeowners need to understand that they do not have to fork over money that they don't have to get things done before your home goes back to the bank and you are in the street. Until now there have been people and companies bombarding people who have received foreclosure notices in the mail or worst posted on the front of their home for all neighbors to see.
Today there are specialist in the real estate industry who has been receiving extensive training in the foreclosure avoidance services and short sales. As of April, 5 2010 the new government program that has released call HAFA which most banks are involved in. Remember banks and mortgage companies have enough properties on their books now to sell they certainly don't want your' home.
The biggest problem that happens in many people wait until the last minute to do anything or they have hire people to do work for them that told them they would get them a Loan Modification and then nothing happened. The fact is that 87% of all loan Modifications that have been successfully completed have ended up in default.
The simple fact is in today's market most homes values are not closed to what is owed on the home and loan Modification did not address the principle of the loan amount and they were really short term. With many people still out of work they have no alternative but to lapse back in default.
So what is it today that can help them?
Now with the new program call HAFA the lenders and the homeowner are going to receive relief by doing a short sale. Today many people are choosing to do a short sale on their home and walk away from the debt and bills and have further obligation to any of the debt now or in the future. If a person goes to foreclosure they will have a deficiency judgment for the banks loses. This judgment will remain on your credit for up to 10 years, and if the bank records the judgment you will have to pay that back to clear it or go bankrupt, either way it's there for 10 years.
With a Short Sale the lender agrees for you to sell the home for less than what is owed including all cost associated with the sale of the home including real estate commissions and all taxes and fees. In addition; you as the homeowner will receive $3,000.00 in moving expenses so you can go and find another home to rent.
In addition to that any other liens that are on the home like a second mortgage is also paid in full and all mortgages will be reported to the credit bureaus as satisfied and settle for less. This happening will reduce your credit score but only a few points as opposed to a foreclosure that will reduce your credit score by as much as 300 to 400 points.
Under the short sale a person who does go through with it will in most case be able to purchase a new home in and around 18- 24 months after the home and the loan is closed. So what would you as the homeowner what 10 years or 24 months this is a no-brainer!
Do I have to be behind in my mortgage to do a short sale?
No if someone tells you that you must be behind in your mortgage payments to have your home sold as a short sale run away this is nothing short of the truth. In fact if you have a home that is so far under value from the original purchase price it may make good financial sense to set that home up for a short sale. Then when you finally move out you will be able to save money when you rent and then find another better home at a much lower price better terms then the one you had before.
Also your credit will not be as damage and in some cases there are lenders right now that will allow you to go out and purchase another home right from selling your home at short sale. So today this Short Sale and Not Foreclosure or throwing your keys back at the bank you may come out better then you think.
Tim Robbins, Sr An Exclusive Buyers Broker in New Jersey for almost 20 years. My training and knowledge affords me the opportunity to help many more people today then ever before I am a Certified Foreclosure Prevention Specialist and Certified in Short Sales in New Jersey. To receive a copy of my Newest Book just released "Should I Short Sell My Home".... How Homeowners can Survive The Worst Real Estate Market in History! Call Me I offering Buyers the option of having their own broker working with and their interest. The simple difference in agents is who they work for when you are making a purchase. You need to have someone on your side who will guide you through all of the intricacies on the most important purchase of you life. To find out more about how you can become an educated consumer and learn more visit [http://NJbuyersonestop.com] or call 1-800-610-3588.
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