Do I qualify for a Real Estate Short Sale and exactly what does that mean? Good Questions.
First, here are some common questions you should ask yourself when thinking about the possibility of a Real Estate Short Sale:
- Am I having difficulty making my mortgage payments?
- Have I recently lost my job?
- Has my mortgage adjusted and can I afford to pay the new interest rate?
- Will my mortgage adjust and will I be able to afford to pay the new interest rate?
- I want to sell my home but is there enough equity?
- I want to sell my home but do I owe more than my home is worth?
- I want a fresh start...Can I get help?
If you answered YES to any of the questions above, you could qualify for a Real Estate Short Sale. "But Mark, just what IS a Real Estate Short Sale?"
A Real Estate Short Sale is when the amount owed your home loan, or loans, is greater than the current market value of your home and your lender agrees to forgive the difference. Hence, "selling short".
The most common reasons homeowners are in a position to consider a Real Estate Short Sale are:
- Unforeseen hardship - Family illness or death, job loss, lowered income, increased debt, etc.
- "Creative" lending - Sub-prime mortgage, 100% no money down mortgage, deferred interest mortgage (option ARM), adjustable rate mortgage (ARM), etc.
- Market Conditions - Unstable economy, values in homes and real estate decrease, loss of home equity, real estate speculators (i.e. flippers), etc.
Market Conditions Effect You: The Real Estate Owners
The real estate marketplace has been ever changing in recent months. Real Estate owners have homes they can no longer afford. Their real estate is worth less than they owe. In numerous instances, this was worsened by the mortgage adjustments (ARM's) which lead to higher mortgage payments. The end result is real estate owners who are unable to pay their mortgage.
"What Does This Mean For Me?"
In order for a bank to foreclose on real estate, they have to spend time and money on legal counsel to proceed with their right to foreclose; generally stated in your mortgage papers. With the current economy and real estate marketplace, they are more willing than ever to participate in a Real Estate Short Sale. Also, if you sell your real estate by way of a Short Sale, you are mitigating any further damage to your credit score. Click here for details regarding how a short sale can affect your credit score.
So, as mentioned before, if you answered yes to any of the questions above, or if you are still unsure if you qualify for a Real Estate Short Sale or you have more questions about what a Real Estate Short Sale is, please contact me at your convenience.