To Quote Lenn Harley
* * * * HARD CORE REAL ESTATE TALK AHEAD* * * *
No day goes by that I don't see real estate agents advertise something like, "I can short sell your home at no cost to you". This leads many distressed sellers who are upside down on their home, or who have suffered some catastrophic financial setback to believe that they can be relieved of their mortgage obligation with no cash to the deal.
Both of these are dangerous assumptions. Nobody can make the claim there will be no cost to you before a complete pre-short sale package of forms has been prepared, and the lender has made a committment. When an agent makes these claims without several hours of discussions with you and your lender, be careful, it is a careless claim at best.
In addition, since Arizona is an anti-deficiency state, sellers are lead to believe they will have no further responibility when the lender takes a loss on the short sale. Borrowers are protected under the anti-deficiency statute ONLY under very specific conditions. The indebtedness must be for PURCHASE MONEY loans, for an OWNER OCCUPIED home of 1-4 units. Home Equity Lines of Credit do not normally qualify. Cash out refinances do not normally qualify either, unless the borrower can PROVE the funds were used to improve the property. Other restrictions also may apply.
If an agent tells you they will NEGOTIATE WITH THE LENDER, run, don't walk away. Agents claiming to do this run the risk of prosecution for practicing law if they don't belong to the state Bar Association. You, the SELLER, negotiate with the lender. Your agent helps you negotiate with the buyer, and helps manage and communicate the transaction, but cannot negotiate with the Lender.
More later, as this is a complex subject and cannot be explained in a brief post.
Jim Little, Your Sun City Neighborhood REALTOR®A Real Estate Agent who lives here and works here.
Representing Home and Condo Buyers and Sellers in Sun City and Sun City West Arizona since 1998.
To Buy or to sell Real Estate in and around Sun City AZ, Pleas contact me.
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Jim- We see those too and it makes our stomach turn. We have an intake evaluation with every potential listing to see if they will qualify for a short sale and then we give them what their chances are based on past experience, here in Florida, most often that will entail a promissory note for HELOCS. But again, it all depends, and that is what we tell them, it all depends. No promises, no guarantees other than doing our best. Katerina