Tag Archives: short sale

Short Sale Vs Foreclosure

April 13, 2011

0 Comments

If you find yourself in the position of having to decide between letting your lender foreclose on your home or attempting to sell in a short sale, below are some pros and cons for each option. A short sale is a great idea in the current real estate market.

Foreclosure

This is a legal process used by your lender to reclaim your property and sell it to pay off your loan. Some are opting to simply let the banks foreclose on their properties and walk away from the loan. If you have the means to continue paying your loan you should continue to pay. A foreclosure will reflect more negatively on your credit report compared to a short sale.

The foreclosure route is the shortest path to ridding yourself of your problem but also the most damaging.

Short Sale

You can request permission to conduct a short sale from your lender at any time. You do not need to be in default to receive permission however you will most likely need to meet several other criteria before you are granted permission. The obvious benefit to this is that you can get out of your current loan early if you are ok with taking a loss.

A short sale also will not hurt your credit score as bad as a foreclosure. If your credit is in ok condition you could possibly purchase another home immediately after your short sale.

At the moment the government is not taxing any debt forgive by your lender during a short sale. All the more reason to seriously consider going the short sale route.
A foreclosure is just all around a bad thing to have on your credit report and will hinder future home purchases for years to come. A short sale can be lengthy and bothersome but it will save your credit and allow you to purchase another home when you feel you are capable of fulfilling your payments.

 

short sale vs foreclosure table data

Continue reading...

Information About Short Sales

April 5, 2011

0 Comments

If you are unsure about what a short sale is I will help you understand. In a short sale you are selling your house for less than its current market value. You will not make any money from selling your home.

In this process your lender will forgive a portion of your debt. You may have to pay taxes on this forgiven debt so please keep that in mind. In order to sell your home in a short sale your lender will have to agree to allow you sell. Your lender does not have to agree but they are more likely to honor your request if you meet certain criteria.

Have you lost your job and are unable to find new work? Have you gotten a divorce? Has there been a major death in the family? Is your home worth significantly less than what you paid? Your lender will require proof from you if you make any of these claims. It is your responsibility to do all of the footwork and present a compelling case to your lender in order for them to approve.

The good news is that in the current housing market most lenders are willing to work with you on a short sale instead of going into foreclosure. A short sale is only slightly better than a foreclosure on your credit report and lenders will be able to tell you sold your home in a short sale. Also, remember that there is nothing short about a short sale. The process can take a long time to complete bringing stress and frustration to your already troubled housing problems.

It’s a good idea to hire a realtor who works with short sales on a regular basis to help guide you as smooth as possible through the entire process. This can make a huge difference in the amount of time it can take to complete. The lender may require you to spend less on your realtor since you are asking them to take a loss on the house.

Continue reading...
Page 1 of 11