Lake Forest CA Short Sale Real Estate Agent Homes for Sale
A short sale occurs when a home sells for less than what is owed on the loan. This happens because many times, homeowners are upside down on their mortgages. They owe more money on their homes than the value of the house. Short sales are often used by people who want to avoid losing their homes. But there are drawbacks to short selling. Lake Forest CA short sale real estate agent who has experience can guide the homeowner during the process.
Sellers sometimes use short sales to try to hide problems with their properties. If the seller doesn't tell potential buyers about issues like mold, water damage, or termite infestation, he could lose his listing. A short sale is a type of distressed property transaction where the current owner agrees to sell the house for less than what it’s worth. In most cases, the former owner owes more money on the loan than the house is worth. Short sales are often used as an alternative to foreclosures.
They require approval from the lender, and the former owner may be required by law to pay off the difference between what he owes and what his house is worth. If the former owner doesn’t make up the difference, the lender typically forgives the debt.
Short Sales Can Be Good Options
The short sale process offers several benefits to buyers. First, it provides access to homes that might otherwise be unavailable. Second, it allows you to buy a home without having to put down a large deposit. Third, it gives sellers another option besides selling their homes to a bank. Finally, short sales allow homeowners to move out quickly while still keeping their equity intact.
Before the process can begin, a mortgage lender must sign off. This is called a “decision to execute a short sale,” often referred to as a pre-foreclosure or short sale. A short sale is a type of real estate transaction where a borrower sells his home for less than what he owes on it. In most cases, the lender agrees to accept less money than the amount due on the loan.
The lender, usually a bank, requires that you provide documentation explaining why a short sell makes sense. You'll likely want to include information about how much equity you have in your house, whether you're facing eviction, and your ability to make payments while living somewhere else.
No short sale can occur without your lender's prior approval. If you do decide to go ahead with a short sale, no matter how well you've prepared, there's a chance that things could fall apart. Your lender might find out that you lied to him or her during negotiations and refuse to approve the deal. Or, worse, your lender might discover that you've been evicted from your current residence. Either way, the whole thing could blow up in your face.
Short Sales Tend To Be Lengthy And Paperwork-Intensive Transactions
A short sale tends to take longer and requires more paperwork than a traditional foreclosure. Most lenders won't even start processing a short sale unless you've already received notice from your mortgage servicer that you're behind on your payments. Once you receive the notice, you'll probably have 30 days to pay enough to bring your account into good standing. During that period, the lender will work with you to set up a payment plan. After that, you'll have 60 days to complete the sale.2
Once the lender signs off on the short sale, the process begins. Typically, a buyer will contact you within ten days. He or she will offer to buy your property for less than what you owe on it.3
You'll Have To Wait For Approval From Both Lenders.
A short sale will impact a person's credit score less than a foreclosure however, it is still a negative credit mark. Also, any type of property sale that is denoted by a credit company as not paid as agreed is a ding on the score. Short sales, foreclosures, and deeds-in-lieu of foreclosure all hurt an individual's credit rating to some degree.
Short sales don't always negate the remaining mortgage debt. There are two parts to a mortgage. The first is the lien against the property that is used to secure the loan. The lien protects the lender in case a borrower can't repay the loan. It gives the lending institution the right to sell the property for repayment. This part of the mortgage is waived in a short sale.
When convincing a lender to agree to a short sale, it's vital that the homeowner be able to cite a new source of financial difficulty, not something that was withheld at the time the mortgage was approved.
You now can set up a free 30 minutes consultation to go over your personal circumstance.
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