The Most Important Short Sale Do’s and Don’ts | Short Sale Tips for Temecula CA Home Sellers
· Do educate yourself. This is THE most important thing you can do. Temecula CA Short sales can be complicated. You need every bit of information you can get when you jump into the short sale process.
· Don’t wait until it’s too late. If you drag your feet and hide from the fact that you’ve stopped making mortgage payments, it will cost your credit rating and it will put any chances of a Temecula short sale in risk.
· Do be diligent. There have been very closable Temecula California short sales that fail because the Temecula homeowners either stop responding to their agents, stop returning paperwork, stop returning phone calls, stop caring, etc. It can be a difficult process, but at the end of it you will be free of the mortgage, the upside-down Temecula house and your financial future will have a better foundation.
· Don’t stop taking care of your Temecula CA home. Yes, you will be moving, but if you stop mowing the lawn or keeping the place tidy, that unkemptness will discourage any potential buyers.
· Do keep paying your HOA dues! Any unpaid HOA dues will need to be settled either before or at the close of a short sale escrow. Sometimes the buyer or the first lien mortgage bank will contribute to these outstanding bills, but not every time. And Temecula California Home Owner Associations will send your defaulted HOA bill to a collection lawyer who will slap you and your property with their own outrageous charges.
· Don’t rent your Temecula CA home out. In these economic times there are unsavory renters, many of them lost their own homes, that don’t mind giving you the first month’s rent and a security deposit, only to never pay you another payment. You lose the Temecula house to foreclosure, but they live rent free for the foreseeable future.
· Do your homework when choosing a Temecula real estate agent or broker when you go to list your house for a short sale. The wrong Temecula California short sale agent can ruin your chances of avoiding foreclosure. Temecula Short sales require diligence, confidence and an unmatched work ethic. Find that Temecula CA short sale REALTOR that knows her stuff, knows how to work and knows exactly what the banks want to approve your Temecula short sale.
· Don’t think that you need a real estate agent that knows your Temecula neighborhood to short sale your Temecula CA home. In a Temecula California short sale transaction, it’s about the short sale negotiation and working relationship with your lender(s), not that your Temecula home’s location is special compared to the listing around the corner. Out-of-area agents easily price properties using a Comparative Market Analysis (CMA). In fact, banks regularly pay agents and real estate brokers a minimal fee, usually $50 or $75, to price out-of-area properties for them. Your local Temecula neighborhood real estate agent may not be the right person. You need a tough and knowledgeable short sale specialist.
· Do expect to move soon, or not for months. When your Temecula home receives an offer, that is just the start for your short sale transaction. But the bank could decide to approve your short sale right away, which means you may only have 30 to 45 days to relocate. But, the approval process could take up to three to six months! Don’t move prematurely. It makes no sense to pay rent while your Temecula CA home sits empty. Communicate with your agent and keep updated on where the short sale process is.
· Don’t stop paying your water bills, sewer bills or trash bills! Any unpaid bills may slow down or stop the short sale process.
· Do consult your tax man or even a tax attorney when considering a short sale. Even the best short sale agents are not legally allowed to advise on tax implications of your particular situation, and the best Temecula California short sale real estate agents don’t. A tax accountant CPA or real estate attorney has a better understanding and the legal right to advise you on such matters.
· Don’t think that you must have a real estate attorney to execute your short sale. Most times these lawyers don’t understand Temecula real estate or the short sale process as well as an experienced Temecula CA short sale agent does. In fact, many if not most of these lawyers offering short sales require an upfront fee to process your short sale. Temecula real estate agents and Temecula CA brokers only collect commissions from the proceeds of the sale, which comes out of the bank’s pocket, not yours.
· Do let your Temecula real estate agent put a yard sign in the yard. Yard signs tell buyers trolling streets looking at neighborhoods and houses that yours is a possible candidate.
· Don’t make viewing appointments unavailable and hard on buyers and their agents. The more potential buyers that see your Temecula California home the better chance of short selling it and avoiding foreclosure. Make that home as available to buyers as possible!
· Do yourself a favor and remember that millions of Americans are going though their own short sale, or unfortunate foreclosure. This economy is dreadful, and many are experiencing financial hardships and your particular situation is nothing to be ashamed of.
· Don’t apply for a home equity line of credit or any other type of credit. If you own other properties that have equity, refrain from pulling money out of any of them during a Temecula short sale approval. Your bank and any of your bank’s back-end investors will dig deep into your credit history and find this activity. This kind of action says you are just out for your own financial bottom line, and yes, they will take offense to that.
· Do a quick pick up of toys, laundry and any other items lying around when a buyer’s showing appointment is scheduled. Buyers will criticize your messiness like your mother-in-law, and worse, it could affect their offer which in turn could affect your Temecula CA short sale!
· Don’t make the mistake of thinking a foreclosure is not much worse than a short sale. It is. A foreclosure will decimate your credit; it will keep you from owning another home for years and it will be a part of your financial incompetence far more than you hope it won’t.
· Do keep your hardship letter short and sweet. Explain your situation as-matter-of-factly as possible. Then your bank will look at your finances, tax filings and other documents to verify and support your story. But DO NOT include in your hardship that you bought your Temecula home for more than it’s worth. The bank does not care your home is underwater. The bank is losing money too.
· Don’t strip the house of its fixtures or other potentially valuable assets. Taking the pool system, or the ceiling fans or the beloved touch-action faucets will degrade your Temecula California home’s marketability, and for what? A few hundred bucks will not make the financial blow of foreclosure any softer.
· Do all your paperwork and return to your Temecula CA real estate agent in a timely matter. Temecula Short sales can die if the proper paperwork is not supplied. It’s a silly way to screw your short sale, but it happens all the time.
· Don’t use a short sale negotiating company. They will charge you large upfront fees that they don’t have to return to you even if they do not complete the short sale. And these companies aren’t held up to the same Department of Real Estate code of ethics that Temecula California real estate agents and Temecula REALTORs are. In fact, some banks will not work with them!
· Do call and communicate with your bank(s) and let them know you are attempting a short sale. They have thousands of mortgages defaulting, and if they don’t know you are pursuing a short sale, your Temecula CA property may automatically be classified as a pre-foreclosure. Not keeping your mortgage holder informed of the status of your Temecula short sale can help expedite your house to foreclosure which will not help your short sale.
· Don’t violate the bank’s At Arm’s Length requirement for the Temecula CA short sale. The Arm’s length agreement required from the short sale lender prevents you from “renting the house back”. To avoid any fraud or risk that can result in the bank coming back at you for the balance of your loan. Do it by the book and follow the rules. The risk is not worth it.
· Do know that credit card companies may decide to pull your credit due to foreclosure. When a foreclosure shows up on your credit, it says that you are in financial distress and your credit risk increases dramatically.
· Don’t think you can’t short sale if you own other properties. This is a common mistake many multiple property owners make. A bank will more than consider a Temecula short sale even if you own two or more homes.
· Do clean the Temecula California home and property when you move out. Remove any trash, debris and take or dispose of any of your personal property. The condition of the property before transfer can have a negative effect on the buyer and their desire to own the Temecula home, and give them a reason to back out. Cleanliness is next to Godliness, and Sold Short Sales!
· Don’t assume the information about short sales you read on the internet is always correct. There are many real estate professionals, and many not-so-professional individuals, giving advice regarding short sales. Some do not have a clue how to handle a short sale, let alone give advice on the subject. Your best bet is to call and talk to any prospective short sale experts. Get a feel of their knowledge base and real estate confidence, and above all else only hire a Temecula CA real estate short sale agent with experience.
If you have questions or would like to talk to us about short selling your Temecula California house, call us any time at (888) 9-List-It. That’s (888) 954-7848.
IMPORTANT DISCLOSURE in compliance with the FEDERAL TRADE COMMISSION ("FTC") MORTGAGE ASSISTANCE RELIEF SERVICE ("MARS"): Before using this service, consider the following information - Coldwell Banker Kivett-Teeters Associates are not associated with the government and our services are not approved by the government. Seller acknowledges that the Broker/Agent is not qualified to provide financial, legal or tax advice regarding short sale transactions. Therefore, the seller is advised to obtain professional tax advice and consult independent legal counsel immediately regarding the tax implications and advisability of entering into a short sale agreement with their lender/servicer. If you stop paying your mortgage, you could lose your home and damage your credit rating.