The following is a typical short sale scenario:
The Homeowners find themselves in financial trouble due to loss of job, reduced income, medical crisis, divorce or separation, high credit card debt, etc.
- The Homeowners default on their mortgage and start receiving notices from their lender demanding payment and threatening foreclosure.
- The Homeowners panic. They are stressed out, cannot sleep and have no knowledge of what to do or who to turn to.
- At this point, most individuals will opt for a short sale. Our short sale clients cross all demographics as to age and income.
- We will consult with the homeowner and help them to list their property for sale. Our clients understand that their home is no longer worth what they paid for it and their mortgage is higher than the current fair market value of the property.
- We will provide the Homeowner with an experienced and knowledgeable short sale realtor. Marketing a home that is being sold as a short sale is handled very differently than marketing for a regular sale. Since the short sale homeowner cannot retain any proceeds from the sale, the goal is not to obtain the highest price, but rather to get the homeowner out of debt with no balance due on his/her mortgage. We pride ourselves in being empathetic to the concerns and needs of our clients; we make ourselves available after hours to discuss the expectations and to guide our clients through this stressful time.
- We will provide comparative analysis to determine the true market value of the house. Short sale homes are listed as "distressed" properties, which lowers the value of the homes due to the potential buyers having to wait for the homeowner's lender to approve the sales price (called "short sale approval").
- Once your house is listed, our realtors will market the property aggressively. No short sale negotiations can begin until a contract for sale is obtained. The lender cannot approve a short sale without a contract, as they need the sales price to determine the net amount they will receive after costs are deducted. We will prepare a proposed Closing Statement (called a HUD-1) that will outline all the costs associated with the sale (i.e. real estate commission, realty transfer tax, attorney fees, etc).
- Once the property is under contract, the file is ready for us to begin negotiations.
- The time frame for short sale approval can be anywhere from 3-6 months after the paperwork is submitted to the lender for review. The time frame is affected by several factors, such as the lender, the degree of cooperation by the homeowner, and the buyer.
- We make sure that the lender's short sale approval releases the homeowner from any deficiency judgment. After the closing, our client walks away with a fresh start.