Short Sale

Short Sales

If you’re facing foreclosure, there may be options you haven’t yet considered. Sometimes losing your home is unavoidable, but there are ways of giving up your home that still allow you to avoid foreclosure. A short sale is an option in which you sell your home before it is foreclosed for less than it is worth. Doing this helps you keep the word “foreclosure” off of your credit report, making it much easier to go on to buy a new home in the future.

Lenders and Mortgage Short Sales

Short sales have many benefits for homeowners, but they are not always the simplest transactions. Mortgage short sales need to be agreed upon by both the homeowner and the lender. Short sales are beneficial for lenders because they help the lender avoid the heavy fees involved in carrying out a foreclosure. However, short sales leave the lender with less than they are owed. Because of this fact, lenders will often try to avoid short sales and will even put stipulations in mortgages to avoid going through these types of transactions.

Understanding the Short Sale Process

A short sale is very much like a regular home sale. The primary distinction is that in a short sale, you’re selling your home for less than its value. For this reason, short sales may result in a purchase rather quickly. Once the sale is complete, your lender may still require that you pay the remainder of what is owed on your mortgage. This amount is called a deficiency and at ALLIANCE LEGAL GROUP we will try to work with your lender to negotiate the deficiency amount or avoid it entirely. If you use a short sale to sell your home, you’ll have to give up your home, but you won’t have a foreclosure on your credit record. Foreclosures stay on your credit report for 7 to 10 years and can reduce your credit score by up to 400 points. However, short sales may not be listed on your credit report which means that your overall score may stay the same. For some people, a short sale is a much better option than foreclosure. If you would like to learn more about short sales or foreclosures, contact ALLIANCE LEGAL GROUP today and set up a free consultation by calling (877) 560 – 4440. During your consultation we can review your mortgage history, understand your long-term goals and provide you with the information you need to make the right decision.