What is an Idaho Short Sale?
A Short Sale is when you need to sell your property but you owe MORE on the property than what you could sell it for. You are asking the lien holder (Bank) to accept a lesser amount as payment in full.
Let's say you bought your home in 2006 and paid $300,000 for it. You mortgaged $285,000. Because of a legitimate hardship, you can no longer make your payments. You MUST sale or you will be foreclosed on. Your home can now only be sold for $250,000. After selling expenses, you would have approx. $230,000 left to pay the bank. So, you would either have to bring $55,000 to the closing table, ($285,000-$230,000=$55,000) OR, ask your lender if they will accept $55,000 less for the note. If the lender accepts, that is a short sale.
Why would a lender want to accept an Idaho Short Sale? Foreclosure is a time-consuming and expensive process for lenders. Many times, lenders recognize that if they accept the short sale, their company will actually loose LESS money than if they foreclose on the home. It is better for their bottom line.
Are all homes eligible for a Short Sale? No, there must be a legitimate hardship, or some reason that you cannot continue to make the payments on your home. Also, there are many different lenders, and each one has different criteria for which Short Sales they will accept.
Does the homeowner have to re-pay the "short" amount? Sometimes (but many times not) the lender will require a homowner to sign a note for all or some of the deficit amount. It is based on your ability to pay. Signing a note however, is a much better situation than having a Foreclosure on your credit history.
Do I have to be behind in my payments? Not always! Each lender is different, and each short sale is based on your financial situation. If you won't be able to continue making your payments, call to find out. Taking action sooner is always better!
If you want to know if you would be eligible for a short sale, please contact me. I will assist you in a professional, confidential, and non-judgemental way. I am here to help you avoid foreclosure!
Visit my Idaho Short Sale page to request an Idaho Short Sale listing package.
Stay tuned for more installments of "Idaho Short Sale~Common Questions"
Pam Pugmire
Bridgetower Real Estate
(208)-921-4800
This information is not intended to be legal or tax advice. I recommend you contact your attorney and/ or accountant for specific legal and tax questions.
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