In today's market where home prices have decreased and mortgage payments have increased due to adjustable rate loans and 100% financing, it's getting more difficult day by day for homeowners to keep up with there payments. This leads homeowners into foreclosure and the risk of loosing there home. Some people feel that the only option that they have is to walk away from there home and let it foreclose. But what they do not know is that they can avoid foreclosure, they can save there credit from being ruined. They can do this by entering what is called the Short Sale Process.
A short sale is the process by which a homeowner can sell a house for less money than he actually owes on the mortgage(s). This is done by the buyer or investor providing proper documentation to the mortgage lenders (hardship package) to convince them to reduce the mortgage balance to allow the sale. The mortgage lender (or bank) actually takes a loss (or write-off) on the mortgage because the value of the home has fallen below the mortgage balance AND the homeowner is in a poor financial condition that will not allow him to continue to pay on time.
If the short sale and the discount on the mortgage are approved by the bank, the home can be sold for a lower price without the seller having to come up with cash to cover the shortfall, and the mortgage is satisfied and the foreclosure process stops.
A short sale my not be the option for you, yet it could be the best option for you. In my next article I will explain what type of situation is best for a short sale and how a homeowner can benefit from a short sale.
Contact Fred Sed 949-274-3733 For Further Information
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