Do I need to qualify for a short sale? How much work will this take? I am in foreclosure, can I still do a short sale? Are there any dangers to be aware of when working a Short Sale? For more information on Short Sales or to determine if a Short Sale is right for you,
Yes. You must prove some type of "financial hardship". Examples include: Job loss, divorce, separation, relocation, job transfer, major illness and/or medical expenses, or high dollar repairs without the financial ability to make them. Short sales are not for everyone. It is not designed for those who "want" to sell, but only for those that "need" or "have" to sell. You must prove your inability to pay your mortgage(s).
What if my home is worth more than what I owe, but after closing cost I am short. Can I still do a short sale?
Yes, it is still considered a short sale. Many homeowners have avoided reducing the price of their home to current market value in a desperate attempt to receive enough money back to pay off their mortgage(s). If this is the case, you are just delaying the inevitable, as home values continue to decline.
Can the bank come back after me for the amount lost in the short sale?
NO, not in most cases. Generally the approvals are granted with a full release. A full release will forgive any deficiency on the amount owed (lost). However, if you have a second mortgage there is the rare bank that will require re-payment of the second position lien in the form of a promissory note or agreement to re-pay after closing. You should consult with a financial advisor regarding tax implications, especially if it is an investment property.
Who pays the Real Estate Brokers commission?
In short, your lender does. Commissions are considered as part of the closing costs that the lender absorbs. Many lenders have a pre-set amount they are willing to pay. But for the seller, you pay $0 out of pocket...nothing more.
For the Seller, not much...For the Agent a great deal of work is involved. The seller will need provide certain financial information and forms for us to present the lender. The agent handles everything else from selling the home, preparing documentation, communicating with the bank, negotiating the transaction to closing the transaction.
What happens to the money that is forgiven from my lender?
ny deficiency owed on the mortgage will likely be written off as a loss by your lender. Because of this, your lenders may also send you a "1099" for any amount "forgiven". Due to the Mortgage Debt Relief Act of 2007, you are NOT required to pay taxes on this money if the short sale occurred on your primary residence prior to 2012. Consult with a financial advisor with any questions regarding this.
In most cases yes. I will depend on what stage you are currently in. If an auction date has been set, many banks will not postpone unless and offer is received at least one day prior to the auction date. It is to the banks and your advantage to work out a short sale if you are in financial hardship. The foreclosure process costs the lender thousands.
When do I have to move if I do a short sale?
You do not need to move until closing occurs. If you are facing foreclosure and actively working with the bank, typically the lender will delay the process for a limited time, allowing you more time to stay in the home.
Be careful of "scams". There are many people out there looking to prey on your financial hardship. These sharks only make things worse. Never sign a quit claim deed, power of attorney or an option to purchase your home without consulting an attorney. A good rule of thumb is to understand that anybody trying to purchase your home will look out for their own best interests in the transaction, NOT yours.
Can my current Realtor work a short sale on my home?
Unfortunately it may not be wise in most cases. Most agents lack the experience and knowledge necessary to effectively handle the intense process of a short sale. Short sales are not part of an agents "basic" training. Results can be disastrous! An agent experienced in short sales knows how to make the deals happen to produce a sucesseful short sale, an inexperienced agent know how to make a foreclosure happen. You want someone like Mary Ellen Murray who has tremendous experience working with lenders, buyers and seller in coordinating successful short sales.
I understand that this may be a very difficult and stressful time for you and your family. My objective is to rid you of the headaches and make things go as smoothly as possible. I have facilitated many short sales for homeowners just like you and have successfully worked with lenders achieving a 98% success rate on closed short sale transactions.
Contact me for more information and a free consultation!
please email me by clicking on the link below.
