In recent years, many homeowners have found themselves in situations where they can’t afford their mortgage payment and look to options to help save their home. This is either due to the fact that they took advantage of short-term interest-only loans and/or their properties are valued lower than their loans. In any event, rather than going through the mortgage foreclosure process and running the risk of getting evicted, there are options available for those individuals wanting to save their credit and stop foreclosure.
Let’s first define what a “short sale” is and then at the end, decide whether or not you wish to pursue such an option. In a short sale situation, the property is sold at a discounted price. Let’s keep one thing in mind that the lender (bank) wants to gain money rather than load up on inventory of properties. The borrower themselves can approach the lender with this viable option if they are unable to continue making the payments on their property. This is a phenomenon that is affecting many people in all areas of the United States.
There are buyers and mortgage foreclosure specialists who are interested in short sales that can offer foreclosure help. They might approach the borrower in distress and have them sign an authorization to release form. The foreclosure specialists draw up all the paperwork including the sales contract for the amount to offer the lender and allow the homeowner to review and sign it. In addition to the offer letter, the homeowner will need to include a hardship letter stating why they can’t make the payments on the mortgage and a statement showing how the short sale can potentially benefit the lender.
A real estate short sale can benefit the homeowner by:
- Helping them save their credit
- Helping them end an embarrassing situation
- Helping them reduce stress and get them back on their feet
- Giving them a fast solution to their mortgage foreclosure process
In today’s housing market, there is a ton of inventory available and banks are losing money everyday. A short sale can stop the mortgage foreclosure process and benefits all parties involved: the lender gains money from the sale, the homeowner can walk away from a property they can no longer afford and the buyer purchases a discounted piece of real estate.
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