10 Reasons Why a Short Sale May Be Your Best Option
Upside down in your home? If you bought a property in the last few years then chances are that you are upside down and owe more on your property than it is worth. Although there are lots of options for you here are 10 reasons why a short sale may be the best bet.
1. Save your credit - Yes, a short sale can affect your credit but it can be less threatening than a foreclosure and there is a possibility that your negotiator can get the bank to agree to report it positively to the credit bureaus.
2. Save the neighborhood - Foreclosures drive neighborhood values down drastically. A short sale is usually sold around market value so there isn't as big of a hit to your area. Your neighbors will thank you!
3. Save your integrity - A foreclosure can be mentally devastating. It can haunt you for 7-10 years on your credit, in conversation, when applying for a loan, etc. A short sale is just that - A sale of the property! No need to explain to your friends or family why you couldn't afford the house. Instead you made a sound business decision and got out from under a property that just wasn't worth it anymore.
4. Save your reputation with the bank - I doubt the bank is going to turn around tomorrow and offer you a car loan but down the road the bank still wants you as a customer. Who are they going to be happy to see walk through their doors in a few months? The person who worked with them, put forth an effort to help, and allowed the bank to limit it's losses or the person who turned and ran away and let the property go?
5. Future employment opportunities - There is no space that I've ever seen on an employment application asking if you've ever done a short sale. But if the subject of foreclosure ever comes up you might want to get another resume sent out soon...
6. Options to Buy another home in 24 months - If you do a short sale and then keep all your bills & payments current you can buy another property in just 24 short months, Maybe sooner! Fannie Mae's newest guidelines state that as long as you can prove you can stay current they will back another loan for you in 2 years. If you get foreclosed on you are going to have to wait 5 years.
7. Options to Buy a new home immediately - How? According to Fannie Mae, if you don't have any 60 day mortgage lates on your credit report then you are eligible by their guidelines to buy a new property right away!
8. Better interest rates in the future - There usually is not a question on loan applications that reads "Did you ever do a short sale?" but I've certainly seen the one that asks "Have you ever had a house foreclosed on?" I'm willing to bet that those that circle the "YES" for foreclosure end up with some pretty ugly loan rates if they get approved at all.
9. Peace of Mind - It is much easier to sleep at night knowing that you did everything you could to save your house and in the end you got it sold to a new buyer, the bank got to limit it's losses, and you are on your way to a new beginning. Sounds like good piece of mind to me!
10. Tax advantages & Cash Back (HAFFA - Program Details) $3,000 for borrower relocation assistance- Are you familiar with the Mortgage Debt Relief Act of 2007 & the Economic Stabilization Act of 2008? They basically state that if you short sell your primary residence between 2007 & 2012 then you may not be responsible to pay any taxes on the amount forgiven.
Short Sale Benefits
Why Lenders Accept Short Sales:
- It costs lenders a fortune to foreclose a property. A short sale helps absorb additional losses and gives them immediate pay-off from the buyer.
- They are lenders, and are not in business to buy and sell real estate
- A REO (banked-owned property) is a liability, not an asset to the bank
- Most lenders are REQUIRED to have an amount up to SIX Times the retail value of each REO in reserves, so a short sale gives them an immediate relief
- Protection of their banking charter
Property Owner’s Benefits to Doing a Short Sale with Us:
- Help in Avoiding Foreclosure
- Far Less Credit Damage than Foreclosure or Bankruptcy
- Simple Relief
- Our unparalleled support includes: Real Estate Professionals, Lenders, Buyers, Consultants and more
- A Fresh Start
- You pay nothing to us upon a successful short sale transaction.
- We have a dedicated Short Sale negotiator that is in constant contact with the Lender. This ensures faster results, a better success rate and the best possible result for you!
- The lender typically pays the selling and buying agent’s commissions, general costs, past due payments, and more. The lender would need to absorb the closing costs as well.
Contact us for a free consultation! There’s no obligation and all information is strictly confidential. We NEVER charge any upfront fees for our services. There is NO COST, FEE OR CHARGE to you!
Note: This information does not provide legal or tax advice; please consult a qualified attorney or accountant. While most results are very favorable, they are not guaranteed. No matter who you are working with, all sellers should be aware that not all results are the same. Every situation is different. We do everything we can to gain the best possible outcome for our clients.