Are You Missing Payments On Your Loudoun Home? What Is A Short Sale?
When you purchased your home you never expected that you would be in this situation. Nevertheless, because of the current state of things you are no longer able to make your mortgage payments.
If you are like many who are struggling with making your mortgage payment, it is important that you understand what your options are. Depending on how far behind you are in your payments some options may be better than others.
Options To Consider
1. Refinance your mortgage. If the issue with your missed payments is an increase in your interest rate, speak with your lender to find out if you still have enough equity in your home to refinance in to a lower rate.
2. Try To Sell Your Home. If you still have equity in your home and can afford to sell it, put it up for sale as soon as possible.
3. List Your Home As A Short Sale. If you owe more on your home than it is worth in the current market, a short sale can be a great option. I will discuss more about Short Sales below.
4. Foreclosure. I do not encourage foreclosure at all because of the effects of it.
5. Bankruptcy. I am not encouraging bankruptcy. There are different levels of bankruptcy that may benefit a family depending on their situation. However, it should only be considered after seeking legal advice (which I am not providing).
What Is A Short Sale?
A short sale is when a lender accepts less for a mortgage than what is owed on it to avoid foreclosure or an auction.
For example… Sandra purchased her home for $200,000. However, the home is now only worth $175,000 and she needs to sell it or else she will go to foreclosure. To avoid this she places the home for sale with her Realtor and seeks the banks mercy to accept less for the home than she originally has a loan for. This is a short sale.
Banks are often open to accept discounts because they are in the business of lending money. However, the more bad debt they have on their books the harder it is for them to lend. A short sale usually saves them money they would have to spend in taking a home to foreclosure or an auction and gets the home off of their books.
If you experiencing a difficult time making your payments and would like to discuss a short sale on your home please contact me. Realtor commission is paid by the bank in a short sale transaction.
If you are considering bankrupsy, foreclosure, or a short sale you should legal counsel. I do not provide legal counsel.
[...] Are You Missing Payments On Your Loudoun Home? What Is A Short Sale? [...]
Great advice on the short sale ~ especially now banks should be more flexible in forgiving the differences in loan amounts just for a short sale to go through. Refinancing would be the best way to keep it, although I believe the qualifications now require more paperwok . As for bankruptcy, one of the chapters has a legal standing that makes the lender comply (is it chapter 9 I believe) and must work out new payment arrangements.