Short Sale FAQs
What is a Short Sale and How does it Benefit You?
A Short Sale is a negotiation between a homeowner, the mortgagor, and a bank, the mortgagee, (negotiate on your behalf by our title company partners) to allow a property to be sold for less than the balance owed. The benefit to a homeowner is that it allows them to get out of a house that is upside down in value. The best part is, you are avoiding foreclosure and are no longer responsible for your unaffordable mortgage payment.
How will a Short Sale affect Your credit?
Short Sales will have a negative effect on your credit, but to what extent will vary from person to person. The most important thing to know about a Short Sale is that you are avoiding a foreclosure recording on your credit. A foreclosure is the most damaging event your credit status can encounter...worse than bankruptcy. A Short Sale has less impact on your credit than a foreclosure. A successful Short Sale will show as 'Paid Less Than Full' on your credit. After a successful Short Sale you will more than likely be able to resume normal borrowing, such as car loans, credit cards, consumer goods, etc., within a short period of time.
How long does the process take?
The process will depend on the marketability of the property, and the particular lender or lenders that hold the loan. On average, our short sales have been negotiated successfully between 60 and 120 days.
If I am current on my mortgage payments do I have to stop paying my mortgage to do a Short Sale?
You are not required to be behind on your mortgage, (nor do we recommend getting behind on your mortgage if you can afford it) but you will be required to show a hardship...again every bank handles each case differently. We can put your Short Sale file together within a couple days and submit it for approval. (Remember, there is no charge for this). That is the best way to determine if your lender will accept a file for approval on a loan that is current.
No. The foreclosure process continues however the Short Sale process can delay or slow down the foreclosure process. The bank would prefer a Short Sale over a foreclosure. A foreclosure will cost the bank more money.
If I do a Short Sale, how much will I have to pay to sell my home?
Most times the owner will not have to come out of pocket with any expenses. Usually all commissions, taxes, association fees, etc... are paid by the lender.
Is it worth attempting a Short Sale if you have already been served with foreclosure papers?
That is the exact time to do a Short Sale because the bank is motivated and the foreclosure process is in full effect.
I have two loans can I still do a Short Sale?
Yes. We negotiate both loans for you. Usually the first mortgage will make an offer for a release of the 2nd.
Do lenders approve all Short Sales?
Not always. If the bank feels you have the ability to keep paying and do not have a legitimate hardship it will not approve the Short Sale. However, if your property is worth less than what you owe they may consider that a hardship in itself.
I can be reached at Bob@BobSellsTampa.com or at 813/263-7141.
There is no obligation and your information is strictly confidential!