Avoid Foreclosure With A Short Sale In Burnt Hills NY
How will A Short Sale Avoid Foreclosure?
A Short Sale is not a decision to make likely. It tends to be a long and difficult process. However, if you are successful, you will avoid a foreclosure on your record.
What is a Short Sale?
A Short Sale is when you sell real estate for less than what is owed. These typically occur, when the borrower can't pay the mortgage on their property. The lender then decides to take a loss on the pressing borrower avoiding foreclosure.
A foreclosure involves hefty fines as well as a poorer credit score for the borrower. Please keep in mind this does not release the borrowers obligation to repay the remaining balance of the loan always.
Short Sale Process
In a short sale, the lender agrees to take a discount on the loan due to the borrower having economic or financial hardship. The borrower sells the property for less than the outstanding balance of the loan, and turns the proceeds over to the lender. The lender will benefit as they will incur a smaller financial loss. A Short Sale tends to be quicker and less expensive than a foreclosure.
What to expect
Although each lender has their own process of short sales, the following steps will give you an idea of what to expect.
- Contact the Lender.
- Submit a letter of authorization.
- Have your real estate agent or lawyer prepare a Preliminary Net Sheet
- Send a hard ship letter to the lender describing why you got into this financial bind.
- Send in proof of income and assets.
- Release copies of your bank statements.
- Have your real estate agent do a Comparative Market Analysis.
- Complete a listing agreement.