Real Estate Agent with RE/MAX Components - Fallston Maryland 616437

First, What is a Short Sale? - It's likely you've heard the term "short sale" thrown around quite a bit. But what, exactly, is a short sale?

A short sale is when a bank agrees to accept less than the total amount owed on a mortgage to avoid having to foreclose on the property.  This is not a new practice; banks have been doing short sales in Maryland for years. Only recently, due to the current state of the housing market and economy, has this process become a part of the public consciousness.

SHORT SALE MYTHS EXPOSED! - Do not try a Short Sale ALONE!

1. A Short Sale and Foreclosure really damage your credit.  A foreclosure in Maryland can stay on your credit for 5-7 years, and can really deter your chances of owning a home in Maryland in the future.  A foreclosure can severely damage your credit.  If you go through a foreclosure it is not to say that you cannot get a loan ever again, but it will be much more difficult.  On the other hand a Short Sale in Maryland can have limiting effects on your credit.  A short sale can damage your credit, but is much less harmful than a foreclosure and can go on your credit report as charged off in full.  I have had clients buy a house in as little as a year and a half after they went through a short sale.  It is not looked at with the same scrutiny that a foreclosure is.

2. There are no options to avoid foreclosure.  Now more than ever there are options to avoid foreclosure.  Besides a short sale, loan modifications, along with deed in lieu are also options.  In most cases (but no all) a short sale is the best option.  Either way, there are more options today than there have ever been to avoid foreclosure.

3. Banks do not want to participate in a short sale, or it is to hard to qualify to be accepted for a short sale.  Banks would rather perform a short sale than a foreclosure any day.  A foreclosure takes a long time and creates a huge expense for the banks; a short sale saves both time and money.  Banks have more foreclosure inventory than ever before, and certainly do not want any more.  Banks more than ever welcome short sales.  Qualifying for a short sale is easier than you think, you need to have a true financial hardship, or a change in your finances and your house has to be worth less than what you owe on it.  Not only do consumers, but banks also now have government incentives to participate in short sales as well.

4. Short sales are not that common.  At this present time, over 33% of national sales are short sales.  Due to the economy, and rising unemployment this is something that is affecting millions of Americans. Some of the sharpest and smartest minds in the country are short selling their properties; this is something that is not just limited to any particular income class.  This has affected everyone from all facets of life.  A short sale should be looked at as a helpful tool, not a negative stigma.  That is why the government is offering programs that actually pay consumers to participate in short sales.  It is not just affecting our community it is affecting communities and consumers across the nation.

5. The short sale process is too difficult ant they often get denied.  Though the short sale process is time consuming; it is not as difficult as the media would have you believe. The problem is that most short sale's that get denied is because of inexperienced agents or people involved in the process that do not know what they are doing.  It is true that if the short sale process is not followed correctly it has a good chance of getting denied.  An experienced agent knows how to avoid this.  Short sales require a lot of experience, and with an experienced agent the process is simple and can close on average of about 95% of the time.

6. Short sales cost money.  A short sale is completely free to the seller of a property.  In fact as mentioned before you could get up to $6,000 to participate in a short sale.  In many ways, a short sale may put you in a better financial position than prior to the short sale.

7. If I am behind on my payments, I can perform a short sale any time.   The farther you get behind on your payments, the harder is is to get a short sale approved.  The closer a property gets to a foreclosure the harder it is to convince the bank to perform a short sale.  The closer to a foreclosure the more money they spend, thus deterring them from doing a short sale.  If you think you need to perform a short sale in Maryland, time is of the essence; the sooner you start the process the better.

8. I can perform a short sale by myself without a Realtor.  This is sometimes what a bank will tell you.  A short sale is a very complex process and each individual short sale is unique.  In a short sale situation, as a consumer you need your interest protected.  Dealing directly with the bank, this eliminates a third party involved looking out for your best interest. It takes many short sale transactions and years of experience to know the ends and outs of short sales.  Robert McArtor with Long and Foster Real Estate, Inc.  knows how to navigate through the complexities of the short sale to get you in the best position possible.

9. I was denied for a loan modification, so I know I will get denied for a short sale.  A short sale and loan modification are two separate departments at the bank.  These processes are totally different in approval and denial.  If you got denied for a modification you still can perform a short sale, in some cases you can get a short sale approved faster than a loan modification.

Short sales have proliferated only in the last few years, so it may be hard to find practitioners who have closed a lot of short sales. You want to work with Robert McArtor who demonstrates a thorough working knowledge of the short-sale process in Maryland and will not try to take advantage of your situation or pressure you to do something that isn't in your best interest.
When you Hire Robert McArtor with Long and Foster Real Estate, Inc. He will:
·         Provide you with a comparative market analysis (CMA) or broker price opinion (BPO).
·         Help you set an appropriate listing price for your home, market the home, and get it sold.
·         Put special language in the MLS that indicates your home in Maryland is a short saleand that lender approval is needed (all MLSs permit, and some now require, that the short-sale status be disclosed to potential buyers).
·         Ease the process of working with your lender or lenders.
·         Negotiate the contract with the buyers.
·         Help you put together the short-sale package to send to your lender (or lenders, if you have more than one mortgage) for approval. You can't sell your home without your lender and any other lien holders agreeing to the sale and releasing the lien so that the buyers can get clear title.

Comments (2)

Marguerite Roland
RE/MAX Allegiance - Burke, VA
Northern Virginia

Great post on Short Sales !

Thank you for taking the time to write it

Jul 03, 2011 04:44 PM
Robert McArtor
RE/MAX Components - Fallston Maryland - Bel Air, MD
Top Listing Agent for Baltimore and Harford County

Thank you!

Jul 04, 2011 02:45 AM