In Orange County, the Orane County Short Sale Specialist is Tri Doan. Having such an expansive inventory and experience on both sies of the process gives Tri Doan, an intimate understanding of the process from start to finnish. In my conversation with Tri, we have found that alot of people are asking this simple question. “What does short sale mean ?” I decided to write a blog about short sales to help anyone who is asking them self what do i need to do and how do I get one. Unfortunately there is so much to a short sale on both ends, there is no way I can cover all the steps in just one blog post. So if you are interested in finding out all there is to know be perapred to spend some time reviewing multiple posts.
There are so many people in and outside the Real Estate industry who have heard the term "short sale" but really have no idea what it means or the process involved with doing one. Be sure you are always working with an Orange County Short Sale Specialist. to get started, lets address the question, “ What does short sale mean ?” The simple answer: a short sale is when the bank agrees to accept a payoff of the outstanding Balance on a loan for a lesser amount than what is due. In short the bank agrees to take a loss on the investment.
To go deeper into the statement, the borrower is asking the bank to take less money than what you agreed to pay them. To put that into perspective, would you enthusiastically take a smaller paycheck because your employer asked you too? That is the exact thing many home owners are asking of the bank that made investments based on your loan. When you purchased the house you agreed to pay the mortgage company a certain amount. The reason they may agree to a short sale is when it is in their best interest to sell the property for a discount instead of foreclosing and getting nothing. Keep this in mind if you are moving through the short sale process and trying to get approved. Legally speaking, the bank is the one doing the favor, no matter what your situation or personal finacial loss. Don’t for one second think I am on the side of the banks! But please realize the reality of the situation. In most cases the bank and it's investors are losing far more than the buyer.
The only time a bank will agree to approve a short sale on a property is when it looks eminent the homeowner will not be able to make the payment and they will be forced to foreclose. On average the cost to a bank averages $30,000 to foreclose on a property and then resell it. So if you can show them cause to do a short sale they may work with you. To see if this could help you, Tri Doan the Orange County Short Sale Specialist for a consultation.
Wait there's more... The catch is, the bank will not do a short sale on your home and let you keep any money you have in savings! In Speaking with the Orange County Short Sale Specialist, I found out, if you have say, $40,000 or $50,000 in the bank, the bank will not let you keep your savings while they take a loss on the sale of the house (their investment). Rule of thumb is if you have more than $7,000 in cash the bank will take it. It is not a federal or state guidline, but it gives you a rough idea of the amount of money you can keep and do a short sale.
This blog gives you the over all idea and general definaition for a short sale. You should have a general idea and starting point if you are interested in qualifying for a short sale. In my next Blog I will go over some of the Strategies I have learned from the Orange County Short Sale Specialist, Tri Doan. I will also see if I can provide you with a sample Hardship letter from an accepted offer, to give you an idea of the requirements banks are looking for to qualify you.
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