A short sale commences when a homeowner and their mortgage lender agree to a selling price lower than the outstanding mortgage debt, hence the term “short sale.”
Losing the ability to maintain regular monthly mortgage payments may lead to negotiations with the lender for a repayment plan or a mortgage restructure.
If these efforts fail and foreclosure becomes a possibility, and you want to avoid the stain of this record on your credit report for two to seven years. Due to added harm to current or future employment opportunities, the possibility of purchasing a car, acquiring appliances, renting a new place, and buying real estate in the near future.
Life is full of challenges, and sometimes unexpected financial shifts can make it extremely difficult to meet all of our financial responsibilities. This can lead to the unfortunate situation of being unable to keep up with our monthly mortgage payments, causing us to fall behind and incur even more penalties.
As a result, the creditor has reported non-payment, and you have been receiving multiple notices regarding late payments, accrued interest, and late payment penalties.
The late payments have already been reported to the credit bureau; consequently, lowering the FICO score. and a NOD has arrived, because the lender(s) are not willing to work with you; may leave anyone at risk of foreclosure, and feeling cornered.
- Is a loan modification not an option if it is not working out as you expected?
- Have you tried to sell but can’t because your home’s value is less than what you owe?
- Are you experiencing financial or emotional crisis?
- Do you want to leave your current dwelling in the best possible manner?
Now is the time to choose how to address the unfortunate financial situation: either by paying the balloon balance, settling all missed mortgage payments with penalties and arrears, or facing the possibility of foreclosure.
Or request a short sale, but first get all the facts bellow:
Don’t worry. There may still be another option you can consider: A short sale.
Guidelines for Short Sales?
Short Sale Instead of Foreclosure
Once you have thoroughly explored all of your repayment options and attempted to restructure your mortgage balance with no success or seemingly impossible responsibility, and once you have acknowledged and accepted the reality of your situation – understanding that there is no viable financial solution – the subsequent step is to determine if you meet all the necessary qualifications for initiating preparations for a short sale.
If you’re looking to sell your real estate property, it’s important to take the necessary steps to initiate the process and make any required modifications to ensure a smooth sale. Additionally, it’s crucial to engage in discussions with the default department of your mortgage company to negotiate a lower pay-off amount amidst financial difficulties, rather than facing the possibility of foreclosure.
This approach is only feasible once you have thoroughly explored all other alternatives outlined in the Short Sale Report guidelines.
Who Qualifies for a short sale?
Typically, the mortgage lenders will only accept a short sale if a homeowner meets all the guidelines and the following:
- Has fallen behind on your mortgage payments (exception may occur)
- Is able to proof hardship (Job loss, less working hours, illness of self or family member, Probate, divorce)
How To Start a Short Sale Process:
To prove your commitment and desire to sell the property while minimizing the lenders’ loss on the defaulted loan, it is essential to actively list the property for sale and make it readily available to potential buyers who may submit offers.
Once you’ve listed the property and received an offer, it’s crucial to compile the necessary supporting documentation for the lender’s short sale package to initiate the short sale process.
Following this, we will immediately provide comprehensive information about the listing and the offer, as well as the necessary supporting documents, to the lender to formally initiate the short sale process.
Request the Short Sale worksheet
- Proof of active property marketing such as a listing or other documentation.
- A contemplated offer
- The last two years tax returns with W-2s and any tax schedules
- Most recent two months of pay-stubs
- Two months of recent bank statements for all your accounts, including (retirement accounts, 401k)
- Mortgage payment coupons for existing mortgages
- Documentation along with a written explanation of your hardship.
- copy of original mortgage note and deed of trust
- A reasonable offer by a potential buyer (if available)
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