What is a short sale and would you qualify?
What is a Short Sale?
Short Sale is the sale of a home when sales proceeds do not fully pay off the existing loan(s) and lender(s) accepts a discounted payoff to fully satisfy the loan.The best part, the existing lender pays virtually all sales costs, including commissions, escrow and title fees and repair costs. You get your home sold, the loan(s) paid off and you avoid foreclosure.
If I do a Short Sale, how much will I have to pay to sell my home?
Nothing, zero, zip. It's true, in most cases you will pay literally no sales costs if your lender approves the Short Sale. All commissions, title and escrow fees, and even most repair expenses are paid by the lender as part of the Short Sale approval. Remember, the lenders motivation to approve Short Sales and accept the resulting losses is to avoid bigger losses through foreclosure.
How do I get started on a Short Sale?
It's easy. Email me today and we will get started at jhill@remax.net If you would prefer to discuss it on the phone, or set an appointment call 815-315-2626. Or you can simply fill out the form below and we will see if you qualify. There is no charge to you to or fee to you ever. The bank pays us to sell your home.
Why would a mortgage company agree to accept a Short Sale?
1)Legal Concerns - Mortgage lenders have come under legal pressure to work with borrowers to equitably resolve situations where borrowers are unable to meet their mortgage obligation, particularly when the borrower makes an effort to arrive at a compromise solution.
2)Wall Street is Watching - Mortgage lenders rely heavily on their ability to package and sell bundles of loans on the secondary mortgage market. They need to sell these bundles of loans in order to put the funds back to work by loaning the money again and collect loan fees along the way. When a home is in foreclosure its a pure loss for them.
3)Asset Management Expenses- If a lender acquires a property through foreclosure, the property will be managed until it is repaired and resold. The bank has to pay someone to make repairs, keep utilities on, and so on.....
4)Reserve Requirement- Delinquent and non-performing loans place another burden on mortgage lenders. These funds cannot be put to work generating new loan fees until the bad loans are resolved.
Do lenders approve all Short Sales?
NO. That is why it is critical to work with someone that has extensive experience at getting Short Sales approved.From the presentation of the Short Sale package to the lender to working with the lenders Loss Mitigation Department, we know how to keep the file moving towards approval.
How dose a Short Sale affect my credit?
The big key here is to avoid foreclosure. By nearly any measure, a foreclosure is the most damaging event your credit status can encounter - worse than bankruptcy. By avoiding foreclosure, you will likely be able to resume normal borrowing (car loans, credit cards, consumer goods and such) relatively quickly.
What sort of hardship would my lender consider legitimate?
Each Short Sale is subject to each different lenders requirements. In General , as long as the hardship is real and the mortgage company believes the loan is likely to become delinquent as a result, the Short Sale request will be processed by the Loss Mitigation Department. A big key to getting Loss Mitigation to accept a hardship is to submit a strong hardship letter. This is something I specialize in. The hardship letter sets the tone for the entire file. Below you will find a list of "hardships" that are common and frequently accepted by mortgage lenders.
Types of hardship that apply:
- Family illness or injury
- Illness or injury in the extended family - particularly if it forces relocation
- Job relocation when the property is equity deficient
- Job loss or significant income loss
- Divorce or split of domestic partners
- Adjustment in mortgage payment or unforeseen increase in living expenses