You may or may not have heard of a short sale over the last year. A short sale is a win-win situation for someone who may be behind on their mortgage and unable to catch up; or maybe someone who has an adjustable rate that just skyrocketed. A short sale occurs just one step prior to a foreclosure.
First, a short sale is a negotiation for sale through a real estate agent between a bank and the homeowner. Certain conditions must be met for a short sale to work. Generally, more is owed on the home than the home is worth (can be sold for); due to market conditions. Also, payments must be behind on the mortgage.
The realtor will negotiate with the bank to pay off a percentage of the loan. For example, if you owe 200,000 on a home and the home is only worth 180,000, that will be negotiated with the bank. If and when the bank agrees and the home sells, you have saved yourself from foreclosure!
www.MichaelBRealty.com
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