February 5, 2014
by David Tal
Here is part two, talk to a professional before making your decision.
Myth Number Five: A short sale will prevent me from qualifying for a new mortgage.
Wrong! You could qualify for a new home loan within just 2-4 years of a short sale; even less if you never fell behind on payments! Comparatively, a foreclosure can ruin your chances of getting a home loan for many more years.
Myth Number Six: It’s hopeless - short sales take months, even up to a year to complete, so the bank will probably foreclose on me first.
Wrong! New guidelines ensure the short sale process works swiftly. If you have a short sale agent to help streamline the process, you could have your short sale completed in as little as 60-90 days.
Myth Number Seven: Since I have a second mortgage on my home, I am automatically disqualified from a short sale.
Wrong! As long as you meet all of the other eligibility requirements, you still may be able to obtain a short sale even though you have a second mortgage. The trick is to have an experienced short sale agent who can help bargain with the subordinate lien holders and get them to release the subordinate lien, forgive the debt and waive the right to pursue deficiency.
Myth Number Eight: If I go through with a short sale, my credit will be damaged beyond repair.
Wrong. Many people who go through with a short sale find that their credit score is much less damaged than it would be with a foreclosure. If you and your short sale agent manage to work out a deal with the bank, sell your home, achieve debt forgiveness and (most importantly) do everything before you ever miss a payment, you could escape with only minor damage to your credit score.
Now that the myths have been busted, should you consider a short sale?
- do not qualify for any options to keep your home, including a loan modification, forbearance, or reinstatement
- need to move in order to keep or obtain employment (including military orders)
- don’t think you can sell your home at a price that would cover your outstanding mortgage amount
- have lost your job or experienced a significant reduction in hours/salary
- for any other reason are unable to keep your home
…a short sale might be perfect for you. Call a short sale agent today and find out if you are eligible!