REAL ESTATE NEWS — We’re received word that some home owners are beginning to receive NODs ( Notice of Default ) after getting behind on mortgage payments. This can be a warning sign of a coming foreclosure, in which the owner may lose the home after the lender files the necessary paperwork, which may or may not require going to court, depending on whether the home loan is bound by a mortgage or California Deed of Trust. The good news is that there are options that can lead to a much happier financial position.
Short sales can be a great option for homeowners who are struggling to make their mortgage payments and facing the possibility of foreclosure. However, the rules surrounding short sales have changed in recent years, and it’s important for both buyers and sellers to understand how these changes could affect their transactions.
Short sale negotiation is a process in which a homeowner who owes more on their mortgage than the value of their property attempts to sell their home for less than the amount owed to the lender. In California, it is important to work with a short sale specialist who has experience in dealing with the complexities of the state’s real estate market. To begin the short sale process, the seller should provide a recent mortgage statement for analysis to determine whether they are eligible for a short sale. The bank usually pays for transfer fees etc, and the commission for the broker is often limited to 5% by the bank. The Corey Chambers Team short sale specialist is available to answer any questions the seller may have about the short sale process, which is usually anything but short. A 4-month escrow is common in a short sale, so it is important to inform the buyer upfront to avoid any surprises that may lead to them falling out of the sale.
One of the most significant changes to short sale rules is that banks are now giving their own period of time for the property to be listed, get an offer, and get escrow closed. If the property is not sold within the time allocated by the bank, then the seller may not have another opportunity to do a short sale. This means that buyers agents must be diligent to place serious offers only, and the listing agent should talk to the buyers agent to ensure that the short sale addendum is signed for a 4-month period.
In addition to the bank-imposed time limit, it’s also important for the listing agent to recommend that the seller not accept an offer unless the buyer is a sure thing. This is because for a short sale to work in today’s market, sellers may only have one shot, and only if the short sale is done early enough.
So, what does this mean for buyers and sellers?
A short sale is not short, but lengthy. Knowing this, an informed, patient home seller and buyer can both realize a very happy transaction in which the buyer gets a special deal while the seller ends up with a better financial position, which may even include unexpected money in pocket.
For buyers, it’s important to work with a knowledgeable and experienced real estate agent who understands the short sale process and can help navigate the complexities of the transaction. The buyer should also be prepared to provide proof of funds and a pre-approval letter from a lender, so that the seller can feel confident that the buyer is a serious buyer who can follow through on the transaction.
For sellers, it’s important to understand that the short sale process can be lengthy and complex, and that there are no guarantees of success. However, by working with a qualified listing agent and being diligent about accepting offers only from serious buyers, the seller can increase chances of a successful short sale and avoid foreclosure.
A short sale can be better financially than a foreclosure in many cases, and it is possible for a seller to receive money from a short sale.
A short sale is a real estate transaction in which the homeowner sells their property for less than the outstanding mortgage balance with the agreement of the lender. In a short sale, the lender agrees to accept the proceeds of the sale as full payment of the outstanding mortgage balance, and the seller is released from the mortgage debt.
Compared to a foreclosure, a short sale can have several advantages for the seller. First, a short sale can have a less negative impact on the seller’s credit score than a foreclosure. Second, a short sale allows the seller to avoid the legal and financial costs associated with a foreclosure. Finally, in some cases, the lender may agree to waive the deficiency balance (the difference between the mortgage balance and the sale price) in a short sale, which means the seller does not owe any additional money to the lender.
It is also possible for a seller to receive money from a short sale. In some cases, the lender may offer a cash incentive to the seller for completing the short sale. Additionally, if the sale price of the property is higher than the outstanding mortgage balance, the seller may receive the difference as proceeds from the sale.
However, it is important to note that a short sale can also have disadvantages for the seller. The process can be time-consuming and may require the seller to provide extensive documentation and negotiate with the lender. Additionally, the seller may need to find a buyer who is willing to purchase the property for less than its market value.
Overall, a short sale can be a better option than a foreclosure for some sellers because a distressed home owner can often go from broke to unexpected money in the pocket with a better preserved financial reputation. Be sure to weigh the potential advantages and disadvantages carefully and to consult with an attorney, qualified real estate professional and financial advisor before making a decision.
Short sale seller and buyers can get a free report. Those who have a received a Notice of Default or are interested in investing in a short sale can request more information on how to get the best financial results in today’s short sale and foreclosure environment.
Investors can get a free list of foreclosures, short sales, auctions, probate and distressed properties. Those who are in distress can get help with financial troubles, late mortgage payments, NOD Notice of Default, short sales and foreclosures. Fill out the online form:
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Copyright © This free information provided courtesy L.A. Loft Blog with information provided by Corey Chambers, Broker CalDRE 01889449. We are not associated with the seller, homeowner’s association or developer. For more information, contact 213-880-9910 or visit LALoftBlog.com Licensed in California. All information provided is deemed reliable but is not guaranteed and should be independently verified. Properties subject to prior sale or rental. This is not a solicitation if buyer or seller is already under contract with another broker.