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Short Sale Tips for Sellers – Why Selling with Arnel G. is the RIGHT Choice.
Navigating Short Sales: HAMP, HAFA, FHA, Agency Short Sale or Non-Agency Short Sale??? What to Do When the Sale Price Leaves You Short.
If you're thinking of selling your home in San Diego, and you expect that the total amount you owe on your mortgage will be greater than the selling price of your home, you may be facing a short sale. A short sale in San Diego is one where the net proceeds from the sale won't cover your total mortgage obligation and closing costs, and you don't have other sources of money to cover the deficiency. A short sale is different from a foreclosure, which is when your lender takes title of your home through a lengthy legal process and then sells it.
1. Consider loan modification first. If you are thinking of selling your home in San Diego because of financial difficulties and you anticipate a short sale, first contact your lender to see whether it has any programs to help you stay in your home. Your lender may agree to a modification such as:
· Refinancing your loan at a lower interest rate.
· Providing a different payment plan to help you get caught up.
· Providing a forbearance period if your situation is temporary.
When a loan modification still isn’t enough to relieve your financial problems, a short sale could be your best option if:
· your total mortgage on your property is more than the Market Value of your home.
· You have a financial hardship, such as a job loss or major medical bills.
· Your lender is willing to entertain a short sale.
2. Hire Arnel of Arnel G Real Estate & Home Loans. Short sales have proliferated only in the last few years, during our initial meeting I will provide you approval letters from loan modification and short sale that I have closed and been a part of the negotiations. You want to work with Arnel who demonstrates a thorough working knowledge of the short-sale process and will not try to take advantage of your situation or pressure you to do something that isn't in your best interest.
When you Hire Arnel G. He will:
· Provide you with a comparative market analysis (CMA) or broker price opinion (BPO).
· Help you set an appropriate listing price for your home, market the home, and get it sold.
· Put special language in the MLS that indicates your home in San Diego is a short sale and that lender approval is needed (all MLSs permit, and some now require, that the short-sale status be disclosed to potential buyers).
· Ease the process of working with your lender or lenders.
· Negotiate the contract with the buyers.
· Help you put together the short-sale package to send to your lender (or lenders, if you have more than one mortgage) for approval. You can’t sell your home without your lender and any other lien holders agreeing to the sale and releasing the lien so that the buyers can get clear title.
3. Begin gathering documentation before any offers come in. Your lender will give you a list of documents it requires to consider a short sale. The short-sale “package” that accompanies any offer typically must include
· A hardship letter detailing your financial situation and why you need the short sale
· A copy of the purchase contract and listing agreement
· Proof of your income and assets. ie. Bank statements, pay stubs.
· Copies of your federal income tax returns for the past two years
4. Prepare buyers for a lengthy waiting period. Even if you're well organized and have all the documents in place, be prepared for a long process. Waiting for your lender’s review of the short-sale package can take several weeks to months. Some experts say:
· If you have only one mortgage, the review can take about two months.
· With a first and second mortgage with the same lender, the review can take about three months.
· With two or more mortgages with different lenders, it can take four months or longer.
When the bank does respond, it can approve the short sale, make a counteroffer, or deny the short sale. The last two actions can lengthen the process or put you back at square one. (Your real estate attorney and real estate professional, with your authorization, can work with your lender’s loss mitigation department on your behalf to prepare the proper documentation and speed the process along.)
5. Don't expect a short sale to solve your financial problems. Even if your lender does approve the short sale, it may not be the end of all your financial woes. Here are some things to keep in mind:
· You may be asked by your lender to sign a promissory note agreeing to pay back the amount of your loan not paid off by the short sale. If your financial hardship is permanent and you can’t pay back the balance, talk with a real estate attorney about your options.
· Any amount of your mortgage that is forgiven by your lender is typically considered income, and you may have to pay taxes on that amount. Under a temporary measure passed in 2007, the Mortgage Forgiveness Debt Relief Act and Debt Cancellation Act, homeowners can exclude debt forgiveness on their federal tax returns from income for loans discharged in calendar years 2007 through 2012. Be sure to consult with your real estate attorney and your accountant to see whether you qualify.
· Having a portion of your debt forgiven may have an adverse effect on your credit score. However, a short sale for your San Diego Home will impact your credit score less than foreclosure and bankruptcy.
Note: This article provides general information only. Information is not provided as advice for a specific matter. Laws vary from state to state. For advice on a specific matter, consult your attorney in San Diego or CPA. |
Short Sale Tips Online Report
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Tips for a Short Sale Seller
As a seller attempting a short sale, you want to be at the top of your game. To succeed, you not only have to find a buyer for your home, but also convince your mortgage lender to accept a loan payoff of less than what you owe. A short sale can be a long and arduous process, and yet, you have no guarantee of success. To help ensure success, here are some good tips for selling in a short sale situation:
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Tips for a Short Sale Buyer
Buying in a short sale transaction can be a boom or bust (or something in between). In a short sale, the property is "upside down," which means the seller owes more on the mortgage than the property's value. The short sale seller and buyer enter into a sales contract, but the seller is not obligated to sell unless the seller's lender accepts a loan payoff for less than what's owed. Some buyers flock towards short sales in hopes of snatching up a good deal, whereas others stay away believing short sales are more trouble than they're worth. Ultimately, as the buyer, you can't be sure your short sale transaction will succeed, but you can certainly stack the odds in your favor. Here are some good tips to help ensure your short sale purchase will be a boom, rather than bust:
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