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  Short Sale  Information for Kosciusko County

What is a short sale?

A short sale is when you need  to sale you home and the current market value is less than the payoff to your lender. Therefore you need the lender to be willing to settle for less than the full amount in order to release the lien so you can close the sale with clear title.

 Example: In 2006 you bought a home for $150,000 and your payoff is $148,000. Because of a job loss you need to sell. But the current market has several like properties for sale at $140,000 which is true value today. In order to sell quickly to avoid a foreclosure you need to price at $135,000. After all your fee's to sell you would expect about $128,000 net sale proceeds, leaving you $20,000 short. If your lender agreed to release the lien against your home for 128,000 then this would constitute a short sale.

Why would a lender do this? Because many times the loss from a short sale would be much less than a foreclosure.
 But keep in mind that a lender might be willing to do this because you can't pay due to a hardship, not because you don't want to pay.
What constitutes a hardship?
  • Loss of income
  • Divorce
  • Death  of co-mortgagee
  • Medical  
  • Escalation of variable mortgage
While this list is not all the reasons, it is most common.

What is NOT a hardship:
  • Excessive debt- sorry but if you have  accumulated a lot of debt from living beyond your means, it is difficult to get a lender to be sympathetic.
  • House is simply worth less than purchase price.
  • You have other assets that could be liquidated
You will have to prove to your lender that because of unforeseen circumstances that you cannot or soon will not be able to make your payments.
They will also verify that you did not commit fraud on your mortgage application. That you did not lie to them about your income , employment or assets.

 We will discuss what to do if you think you may qualify on our next post. In the meantime if you have any questions or uncertainties about a short sale or want our help, please contact us.

Your Short Sale Connection for Kosciusko County


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Greg Miller   
Mortgage Loan Originator 
NMLS # 234777
www.Ruoff.com
gregm@ruoff.com
574-268-9033


 

3 Comments on Short Sale Information For Kosciusko County

JAN
31
2009

This is good information and unfortunately this will be happening more so than not.  I hope this reaches out to those folks that really need your assistance.  I also hope things in Syracuse area are well.  I know there are only a handful of industrial facilities in the area, and I have also heard the manufactured housing industry north of Syracuse has slowed down as well.  I hope things keep going forward.  Good luck in all your doing. 
9:23pm • #1
Localism Sponsor

Thanks for stopping by BOB. Yes the RV & Manufactured homes have really slowed.My previous career was a manufactured home dealership. I thank the good Lord often that he brought a capable buyer to me and took me out of that industry. Just 5 years ago we had over 300 dealerships in Indiana, now about 50. Liberty homes in Syracuse is even closing after almost 70 years.

 God's Grace & Peace to you !

 
10:06pm • #2
FEB
05
2009

Very good informative blog, Greg and Sharon. Thisinformation is critical in these times, the more you know how this realm of real estate works, the more efficient you an be. Doing a short sale can be very tedious, the more you can understand the more likely it can be a successful experience for you and your clients! again, thank you.
12:36pm • #3

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Greg Miller/ Warsaw Indiana Home Loans - Conventional, FHA,USDA

Warsaw, IN

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Ruoff Home Mortgage

Address: 310 Enterprise Dr., Warsaw, IN, 46580

Office Phone: (574) 268-9033

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