Short Sale Resources

Frequently Asked Questions

What is a Short Sale?

In the world of real estate, a short sale refers to the sale of real property for an amount less than the amount owed on the property. In the short sale scenario, the bank agrees to accept less than the full balance due on the debt, and usually ‘forgives’ al or a large portion of the difference. It is important for you to pay your HOA Fees.

How will the Short Sale affect my credit?

Banks have the option of submitting the short sale to the credit bureaus as “Paid in Full” or “Settled for less than full balance”. If you are currently behind on your mortgage or facing foreclosure, the short sale can actually help your credit! How? Because once you are approved for the short sale, all collection activity will STOP and you will avoid foreclosure! Then, once your property closes, your current mortgage balance will be removed from your credit file and replaced with a zero balance, which also helps your overall debt ratio.

Why would my bank forgive the difference?

To mitigate their losses, banks often accept a settlement of less than what is owed on the property. When faced with the option of getting the property ‘back’ through foreclosure, a short sale usually makes a much wiser business decision for the bank.

This sounds too good to be true!?

Not really. Things that are ‘too good to be true’ usually don’t make good economic sense. The short sale makes good common and financial sense for the banks who grant them. The fact of the matter is, mortgagecompanies and banks are NOT in the real estate business. They are in the LENDING business. The last thing they want is that property back.

What if I owe exactly what my home is worth?

Even if you owe exactly what your home is worth, you may still need to do a short sale in order to cover the costs of the sale (Realtor commission, Title Policy and other seller closing costs). Why not just let my lender foreclose NO! What is the first thing banks do when they foreclose on a property? Hand it over to a real estate agent to get rid of it quick! The foreclosure process is a legal process. It involves attorneys and it costs MONEY. If your bank takes the property back via foreclosure they must often sell it for MUCH LESS than market value and pay Realtor commissions and all customary closing costs. Doesn’t it make more sense for them to take at or a little below fair market value before foreclosing? And, even when they do sell it through foreclosure... this does NOT remove your obligation to repay the remaining balance! It is not wiped away!!!

How long does a short sale it take?

Short sale approval can take 60 days or longer. 

What if my home is already in foreclosure?

Your foreclosure sale will usually be suspended during the short sale process. That’s why it’s imperative that you contact us right away!!!

How much commission do you charge?

The real estate commission (our fees) on a short sale are paid by your lender! 

Do you think I should just do a loan modification instead of a Short Sale?

If you desire to keep your home and can afford to make the monthly payments, then YES you should try to keep it! In order to qualify for a loan modification, you will need to demonstrate to the bank that you are generating more income than your current monthly expenses. Is this the case? If so, you will need to call your lender and let them know you want to do a loan modification, and see if they will qualify you. Unfortunately, more than 95% of all loan modification applications are< denied.="" if="" you="" aren’t="">