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Welcome to 2010 - "The Year of the Short Sale" - Part #6

By
Real Estate Agent with Brokers Inc. Residential Real estate 01146606

This is the 6th of 8 postings in a series about "short sales."  If you are a home seller or buyer that is thinking of pursuing a short sale, please read the following, then give me a call if I can be of further assistance.

El Dorado Hills short sale closed in 2009Selling my home via a Short Sale sounds too good to be true, what's the catch?  When it comes right down to it, choosing a short sale, over a foreclosure, is not a difficult decision.  A foreclosure on your credit report is the "scarlet letter" in real estate finance and will leave your FICO score in shambles and likely prevent you from buying a home for the next seven years. 

Yes, negotiating and closing a short sale is complicated business and will take some time, but it can be done.  Your key to successfully performing a short sale is hiring the right Realtor.  It is imperative that you select an agent that understands how to list, market, negotiate and close short sales.  Once you miss a payment, there will be no margin for error and the clock will literally begin ticking...  Your financial future and credit rating will hang in the balance and you need to have it handled by a short sale pro.

When it comes to selling your home via a short sale, here is what you can expect:

  • A short sale will not cost you any money.  All real estate commissions and fees will be paid from the short sale proceeds.  In the end, these costs will simply reduce the amount of money the lender(s) receive.
  • A short sale will relieve you of paying the monthly mortgage payment(s) you can no longer afford.
  • You will avoid foreclosure and your credit rating will be preserved.  In fact, a short sale will protect your credit from the destructive, irreversible stigma of a foreclosure.
  • You will walk away from your home without owing the lender(s) any additional money or payments.  When completed, it will be considered as a "settlement of a debt" with no further balance owed*.
  • Although the short sale is a forgiveness of debt, you will not owe the IRS any tax payments as a result of the short sale*.
  • IMPORTANT: Closing a short sale takes expertise and TIME.  DO NOT wait until a Notice of Default is filed on your home.  The moment you feel like you are going to start missing your payments, give me a call.  Due to government imposed time-lines, the quicker you act, the more leverage you will have with the lender(s), increasing the likelihood your short sale will be successful.

When confronted with a seemingly insurmountable situation, the best course of action is often to meet it head on, understand your options, take control and make a prudent decision.  If you find yourself upside down on your home and without the money to make your mortgage payment, understand this is a sign of the times, has happened to many people before you, and that you do have options.  My best advice is to move in a timely manner, pursue a short sale and avoid a foreclosure.

Want to learn more?  Read part #7 of this article, then visit http://www.BrokersCorp.com.

* Some restrictions regarding purchase money loans and investment properties do apply.

 

Brokers Incorporated Residential Real Estate Folsom

Aaron Cullen is a Realtor , Real Estate Broker , and Owner of Brokers Inc. Residential Real Estate.
Aaron lives in Folsom, CA and specializes in representing home buyers and sellers in Folsom,
El Dorado Hills and the Greater Sacramento Region.  Having relocated from the Bay Area in 2004,
Aaron continues to work with home buyers in all cities lying between the Bay Area and Sacramento Area.

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