The reasons someone might find themselves having trouble making their mortgage payment and in need of a mortgage short sale can vary significantly and is not based on any particular demographic for age, income, or social standing. Some people find themselves having financial difficulties due to the loss of a job, a reduction in income, disability, significant medical expenses, an increase in family size, a divorce or separation, high credit card debt, and many other reasons.
Short Sale Procedure
- You will need lender approval to do a mortgage short sale in New Jersey.
- Once you have approval of a NJ short sale, we can help list the property for sale. Keep in mind that when the fair market value of the property is higher than the mortgage owed, there will be no excess funds from the sale of the home.
- We will provide you with an experienced and knowledgeable New Jersey short sale realtor. This is important because marketing a home for a short sale is handled very differently than marketing for a regular sale. In the case of a mortgage short sale in NJ, the goal isn't to sell the property at the highest possible price because there won't be any of extra money left over, anyway. Instead, the goal is to just to get the property sold and the debt eliminated.
- A comparative analysis is done to determine the true market value of the property. Because mortgage short sale houses are listed as "distressed" properties, the property value is lowered and the sale price requires the approval of your lender before the sale can be completed. This is called a "short sale approval."
- Once the house has been listed, our NJ short sale realtors aggressively market the property. A short sale can be a lengthy process, so it's best to get started as soon as possible.
- To begin negotiations for a short sale, a contract for sale must be obtained. Your lender cannot approve a short sale without a contract for sale because a sales price is needed for them to calculate the net amount that they will receive after all costs are deducted.
- A contract for sale and a closing statement, also known as a HUD-1, will outline all the costs incurred by the sale, including real estate commission, realty transfer tax, attorney fees, and others depending on the specific property.
- Once a contract for sale of the property has been created, we can begin negotiations.
- A mortgage short sale approval can take anywhere from 3-6 months following the date the paperwork is submitted to the lender for review. Keep in mind that a short sale means that the funds will be short, not that the sale will be a short process. This time frame can be affected by several factors including the lender's process, your cooperation, and the cooperation of the buyer.
- Finally, we make sure that the lender's short sale approval specifically releases the homeowner from any deficiency judgment for the remaining balance of the mortgage after the property has been sold. Our clients walk away from the closing owing nothing further on the property.
A mortgage short sale in NJ is not for everyone. If you need to get out from under your mortgage quickly, a short sale may not be your best option, as the process can be fairly lengthy. If you have not, yet, defaulted on your payments, you may have other options that would be better for you in the long run. Whether you've already begun to receive foreclosure warnings or are just becoming concerned about your finances, contact us right away. We can help you decide on the best plan of action for your situation and get you on the road to financial freedom.