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Riverside & Corona Real Estate
Short Sale Information for Sellers - Pedersen Real EstateConsidering Short SalesFor owners who can no longer afford to keep mortgage payments current and cannot sell their home because it is worth less than what is owed, there are alternatives to bankruptcy or foreclosure proceedings. One of those options is called a "short sale." When lenders agree to do a short sale, it means the lender is accepting less than what is due. Not all lenders will accept short sales and not all sellers qualify for short sales. There may be significant tax consequences. It is possible that the forgiven debt could be considered as income and there are no guarantees that a lender who accepts a short sale will not legally pursue a borrower for the difference between the amount owed and the amount paid. This is commonly known as a deficiency. A lawyer or your tax accountant can determine whether your loan qualifies for a deficiency judgment or claim. See if the bank will do a loan modification and don't easily give up. Keep trying. IF they won't agree to a loan modification and after consulting with your attorney or tax accountant, you decide that you would like to do a short sale, find a Realtor experienced with short sales, like Pedersen Real Estate You will need to provide authorization to your lender in writing that you agree to allow them to work with your Realtor, title company or lawyer. Without this written authorization the lender will not discuss anything relating to your situation or short sale withi your Realtor. Your Realtor will provide you with the appropriate letter to fill out and sign. You will have to provide the lender a hardship letter telling your situation and what you have done so far to remedy your situation. This statement of facts describes how you got into this financial bind and makes a plea to the lender to accept less than full payment. There are instances that a bank will consider a short sale with an underwater house even if the seller is not experiencing significant financial hardship. You will be required to prove income and assets. Be truthful and honest about your financial situation and disclose assets. Lenders will want to know if you have savings accounts, money market accounts, stocks or bonds, negotiable instruments, cash or other real estate or anything of tangible value. You will have to provide copies of your bank statements. If they show unaccountable deposits, large cash withdrawals or an unusual number of checks, you should explain each of those line items to the lender. In addition, the lender might want you to account for each and every deposit so it can determine whether deposits will continue. . Your lender will want to know what your home is worth in the market today. Your Realtor will provide information on recent comparable sales to the lender. The offer from a buyer that you accept along with a copy of your listing agreement is required by the lender. There will be other items that the lender requires but this gives you an idea about what is needed for the lender. Again, we can't stress enough - get professional advice from a laywer or your tax advisor before you attempt to do a short sale. More info about short sales and click here to read information about the documentation required from the homeowners Return to main page
Pederen Real Estate
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