If you’re thinking of selling your home, 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 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 because of financial difficulties and you anticipate a short sale, first contact your lender to see if it has any programs to help you stay in your home. Your lender may agree to a modification such as:
When a loan modification still isn’t enough to relieve your financial problems, a short sale could be your best option if
2. Hire a qualified team. The first step to a short sale is to hire a qualified real estate professional* and a real estate attorney who specialize in short sales. Interview at least three candidates for each and look for prior short-sale experience. Short sales have proliferated only in the last few years, so it may be hard to find practitioners who have closed a lot of short sales. You want to work with those who demonstrate a thorough working knowledge of the short-sale process and who won’t try to take advantage of your situation or pressure you to do something that isn’t in your best interest.
A qualified real estate professional can:
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
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:
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 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:
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 or CPA.
Reprinted from REALTOR® magazine (REALTOR.org/realtormag) with permission of the NATIONAL ASSOCIATION OF REALTORS®. Copyright 2008. All rights reserved.
Increase your chances of getting your dream house in a competitive housing market, and lower your chances of losing out to another buyer.
1. Get pre-qualified for a mortgage. You’ll be able to make a firm commitment to buy and your offer will be more desirable to the seller. Work with a local lender who knows the current market.
2. Stay in close contact with your real estate agent to find out about the newest listings. Be ready to see a house as soon as it goes on the market — if it’s a great home, it will go fast.
3. Scout out new listings yourself. Look at Web sites such as REALTOR.com, browse your local newspaper’s real estate section, and drive through the neighborhood to spot For Sale signs. If you see a home you like, write down the address and the name of the listing agent. Your real estate agent will schedule a showing. Your real estate agent can also set you up on a property search that will e mail you homes that fit into your critiera.
4. Be ready to make a decision. Spend a lot of time in advance deciding what you must have in a home so you won’t be unsure when you have the chance to make an offer.
5. Bid competitively. You may not want to start out offering the absolute highest price you can afford, but don’t go too low to get a deal. In a tight market, you’ll lose out. By hiring the right agent, they will do all the negotiating for you, so you get the best price.
6. Keep contingencies to a minimum. Restrictions such as needing to sell your home before you move or wanting to delay the closing until a certain date can make your offer unappealing. In a tight market, you’ll probably be able to sell your house rapidly. Or talk to your lender about getting a bridge loan to cover both mortgages for a short period.
7. Don’t get caught in a buying frenzy. Just because there’s competition doesn’t mean you should just buy it. And even though you want to make your offer attractive, don’t neglect inspections that help ensure that your house is sound.
Contact Andrea Haitz for a list of homes for sale in the Grand Junction area and for a list of Bank Foreclosures in the Grand Junction area.
Provided by NAR.
Have you recently been hearing people chatting about the great bank owned and foreclosure deals that are out there but can’t quite seem to get a grasp on where to find em? It’s actually very simple. When a home is going to foreclosure it will first show up on the public auction list. Not too many homes sell in this phase of the foreclosure process as buyers must have the funds available to purchase the home by 1pm the day of the auction. When the house fails to sell at public auction, it then returns to the lender and becomes bank owned real estate or REO. These are then re-listed with a real estate agent on the MLS. This is where most buyers find these great deals and you can too. As a real estate agent, I have several tools at my disposal. I can create a current list of foreclosed bank owned homes from our local MLS and simply print this or email it to you. Since these properties sell rather quickly, the list obviously changes from day-to-day. I can also go into the MLS and set an email alert for my clients based on specific criteria such as: bank owned, 3 bed, 2 bath in the city. My client would then receive a daily email straight from our MLS system with the most updated bank owned homes currently available. The email would include pictures, details about the property and lending available. When you see a property you are interested in, simply shoot me an email or give me a call and we will go and see it. Or we can also set up a day and preview a number of bank owned homes. It’s really that simple. So what are you waiting for? Let’s get you set up today. Call the Real Estate Super Diva 970-201-3578