While property values are anticipated to decrease through 2009, many homeowners are finding themselves in a position where they owe more on their mortgage than their property is worth.
If a loan modification is not attainable, and a bankruptcy is not acceptable, a short sale may be another option for borrowers that are facing foreclosure due to a hardship.
What Is A Short Sale?
A Real Estate Short Sale is basically the process of negotiating with a bank to sell a property for less than the value owed on the mortgage(s).
How Do I Get Approved For A Short Sale?
The process of qualifying for a short sale requires a similar hardship package as a loan modification, however the hardship letter needs to detail how a borrower is no longer able to make payments.
While some banks may require the homeowner to be delinquent on their mortgage in order to be considered for a short sale, it is important to be aware of the implications to your personal credit scores, as well as the impact a mortgage late will have on your relationship with other creditors.
Each bank/servicer has different guidelines when dealing with a distressed homeowner. State laws, other lien holders, neighborhood comps, payment history, and several other factors may influence a positive or negative outcome.
Related Articles
- When Walking Away Becomes A Business Decision
- Can I Be Sued After A Short Sale?
- Understanding Net Present Value (NPV)
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