Can I Short Sale My Own Home?
Short selling your own home is a question that comes up quite often. The answer to this would be NO, this would be illegal. Neither the homeowner themselves or a friend or family member can short sale the property. A short sale must be an Arms Length Transaction, which means exactly what I have stated above. No one who is involved with the defaulted owner can assist them in the short sale process.
A short sale is when a bank or mortgage lender agrees to decrease the balance of the mortgage amount that is due, in order for a short sale to work and be successful. They would only agree to this process if the homeowner has a legitimate financial hardship. The bank or mortgage lender does not want the homeowner to profit in anyway and by a friend, family member, or themselves conducting this process, they feel that a profit would be involved.
If a short sale has begun and the process is under review, and if the bank finds any evidence that this is not an arms length transaction, then they would stop this process and would not allow this homeowner to short sale there home. Meaning that they would have lost there only chance to avoid foreclosure.
Another question about short sales is whether or not a defaulted homeowner can go down to there local banks branch or mortgage lenders office and talk to them about reducing there balance. Unfortunately, things don't work that way anymore in the banking business. Once you obtain a mortgage, it typically gets bundled with other mortgages and sold to other banks or investors.
Oftentimes, the company to which you make your payments is not even the bank who holds your mortgage; they are simply paid to "service" the loan. Also, once you mortgage lender begins the foreclosure process, the file is turned over to a loss mitigation company so the "lending" departments or the branch no longer have anything to do with the loan.
All negotiations of a short sale are done by me (your broker) and my short sale negotiation company. We deal directly with the specific banks loss mitigation company.
CONTACT FRED SED AT 949-272-0125 OR EMAIL AT INFO@BESTOCPROPERTIES.COM
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