Short Sales are Better Alternatives to a Foreclosure for Everyone

What is a Short Sale?
A Short Sale allows the mortgagor in default to sell his/her home using the net sale
proceeds to satisfy the mortgage debt, even though these proceeds are less than the
amount owed. (HUD, U.S. Department of Housing and Urban Development)

Why Would I, a Homeowner, Want to Do a Short Sale?
The need for a Short Sale is caused by a borrowers inability to make payments in the
agreed upon time-frame or because the property is worth less than the borrower owes.

If the Homeowner is upside down on the mortgage by 10% or more, or if the
Homeowners income is 10% less than their current expenses, then they should seriously
consider a Short Sale.

Why Would My Bank Consider a Short Sale?
Lenders often consider a Short Sale because their odds of getting a higher percentage
of their principal back as compared to forcing the property into Foreclosure is much
greater. In a Foreclosure, the Mortgage Bank runs the risk of the property being
neglected or damaged, additional delays and costs and other market losses.

Today, most lenders won't commit to a Short Sale until their is a valid and firm purchase
offer in hand from a qualified new buyer, and a knowledgeable broker/agent who can
negotiate the deal. It's imperative to work with an experienced real estate broker for they
will need to prepare a professional and complete Short Sale package.

How is a Short Sale Negotiated with a Mortgage Bank?
Short Sales are one of the most difficult and complicated residential transactions in
today's market. Compared to a normal sale, these transactions require additional
paperwork, intricate negotiations with the mortgage banker(s), and careful preparation of
the process and purchase offer. A Short Sale package typically includes: a purchase
offer contract, buyer's loan qualifications, a realistic and detailed analysis of the fair
market value of the home, current local real estate market conditions, seller financial
information, seller hardship letter, plus much more.

In short, the Short Sale real estate professional must demonstrate to the mortgage bank
(s) that the home is upside down, the purchase offer is fair and just, and the homeowner
has a financial hardship worthy of a Short Sale.

Do I need a Real Estate Professional for a Short Sale?
Although, it is theoretically possible to complete your own Short Sale, we strongly
recommend that you do not. We recommend that you find a local Realtor who can show
you their ability to close and negotiate past Short Sales.

How does the Real Estate Professional Get Paid?
An experienced real estate professional will negotiate his fees with the Mortgage Bank
(s). Commissions are paid by the bank as part of the Short Sale process. Therefore,
our services cost you nothing.

Why Should I Do a Short Sale Instead of Letting It Be Foreclosed?
If you do not qualify for a Loan Modification or do not wish to stay in your home, time is of
the essence. We have found that homeowners that are in denial or believe they can stop
the Foreclosure process when their mortgage payment alone exceeds their current
income, we have found that they are most likely to end up in Foreclosure.

In a Foreclosure:

credit gets damaged
you most likely won't be able to buy again for at least 7 years*
you will be responsible for attorney's fees
there will be a court settlement and information is made public
if you have additional lien holders, they can garnish your wages

In a Short Sale:

credit gets dinged, but not damaged
you should be able to buy in 3 years (with good credit)
attorney's fees paid by the bank
Realtor fees paid by the bank
no court settlement and therefore, information not public
additional lien holders are negotiated