Short Sale Details
What is a Short Sale?
A short sale can be an excellent
solution for homeowners who need to sell, and who owe more on their
homes than they are worth. In the past, it was rare for a bank or lender
to accept a short sale. Today, however, due to overwhelming market
changes, banks and lenders have become much more negotiable when it
comes to these transactions. Recent changes in corporate policy and the
Obama administration have also improved the chances of getting a short
But to be technical, here's a more official definition:
- A homeowner is 'short' when the amount owed on his/her property is higher than current market value.
short sale occurs when a negotiation is entered into with the
homeowner's mortgage company (or companies) to accept less than the full
balance of the loan at closing. A buyer closes on the property, and the
property is then 'sold short' of the total value of the mortgage.
For homeowners to qualify for a short sale, they must fall into all of the following circumstances:
- Financial Hardship – There is a situation causing you to have trouble affording your mortgage.
- Monthly Income Shortfall
– In other words: "You have more month than money." A lender will want
to see that you cannot afford, or soon will not be able to afford your
- Insolvency – The lender will want to see that you do not have significant liquid assets that would allow you to pay down your mortgage.
seems simple enough, but it is a complicated process that takes the
expertise of experienced professionals. As a
CDPE we can assist you in the quick execution of a short sale transaction.
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