Millions of Americans have found themselves unable to keep up with their mortgage payments. Unfortunately, some of the loans that were marketed to homeowners favored the interests of the lenders heavily, and some of them were little more than subprime scams designed to put homeowners completely underwater. If you're facing foreclosure, a short sale is one of the options available to you. This isn't a miraculous cure that will solve all your problems, but it can very much insulate you against the worst damage caused by being foreclosed upon. Whether or not this works for you will depend upon your situation, your short sale specialists ability to facilitate the short sale, and the willingness of your bank to work with you.
Your bank or other lender, to put it bluntly, does not want to foreclose. Foreclosure is the equivalent of loss for a lender. They'll also be responsible for the house after they foreclose on you, which means that any repairs and maintenance required will fall on their shoulders. In this sense, you and the bank have a mutual interest: You don't want to be foreclosed upon and they don't want to foreclose. You have to let them know that you're interested in reaching a short sale agreement by contacting their loss mitigation department.
This won't be easy. The bank may take months to approve a short sale and they may well be rude to you in the process. Understand that this is a business transaction. No one is going out of their way for anyone else in this scenario, and you're not asking the bank for special treatment. The bank has a vested interest in not foreclosing and, because you're in a situation where you cannot make your house payments, you have a vested interest in getting out from under the debt. This is as close to a win/win situation as one can expect in these difficult circumstances.
A short sale most often involves other lien holders. These may be companies that you took out loans with against your home equity or they may be the holders of second mortgages. In some cases, these lien holders may be able to stop the short sale. However, there are so many mortgages that have gone bad since 2008 that most lenders are willing to go along with a short sale. It's in their financial interests and, if someone cannot afford their house, there's no sense in trying to intimidate them out of money that they don't have.
A short sale is sometimes done with the assistance of a lawyer, but usually you'll need to hire a real estate agent who specializes in short sales. If you're already in hot water with your bank, you know that they can be intimidating. Home equity line of credit lenders can be even worse.
If foreclosure is inevitable, a short sale may be the best options for you. It will affect your credit, of course, but the damage may not be quite as bad as having a foreclosure on your credit report. You may be able to buy your next home sooner than you could with foreclosure. You may also be liable for the remaining debt on your mortgage, though it will be far less money after the house has been sold. Fortunately, there are many government bodies adopting anti-deficiency laws to protect homeowners from the bank seeking to collect on that remaining debt.
If you have any questions, please feel free to contact me through my website at http://www.GoldenStateRealEstate.com or by phone at (805) 520-0525. Comments and feedback through this site are also very much appreciated!
Sean Crosier
Broker/Owner
Golden State Real Estate
Article Source: http://EzineArticles.com/?expert=Sean_Crosier
