Short Sales

Short sales have become the dominate sale type in many real estate markets today.  All of the major banks have slowly been ramping up their short sale departments to handle more and more of these sales.  A short sale is when the property sells for less than what is owned on the property.  In most cases the bank that holds the mortgage is being asked to take less on the property than what is owed to them, this is called a short payoff.  However, the homeowner may also be able to pay the difference between what the house sells for and what is owed, this would be a short sale but not a short payoff.  In today’s markets most homeowners are so underwater and so far behind in their payments that the bank is being asked to take a loss and allow the property to be sold for less than what is owed and therefore receive less than what is owed to them.

Why would the bank agree to this?  In almost all cases the bank will actually save money by doing a short rather than going through the foreclosure process. A short sale is also beneficial to the bank because the property remains occupied by the owner during the process and therefore cared and maintained and less subject to theft and vandalism that is so prevalent in vacant foreclosed  properties.

What about for the homeowner, what benefits are there for them?  The homeowner avoids having a foreclosure recorded against them and appearing on their credit report.  The homeowner will also be eligible for a new home loan in a shorter amount of time than if they allowed the house to go through foreclosure.  The homeowner is able to make a more responsible and graceful exit from the property as compared to an eviction or lockout.  In addition, many banks are now offering short sale cash incentives to homeowners unable to make their payments and where a loan modification was not possible or unwanted.  Some banks have paid out incentives up to $35,000.

How to get started?  Please call us to discuss your particular situation and what short sale incentives or programs your mortgage holder may be offering.  We have completed short sales with Bank of America, Chase, Wells Fargo, just to name a few.  Find out your options!

Call 562-704-5626 to speak with James Stinnett today.