Short Sales Help
Part I

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Like many others, you may find that you need to sell your home for less than you owe on your mortgage. This is referred to as being under water. This is known as a "Short Sale."

With a "Short Sale" you may be able to walk away from your property without having a foreclosure on your record, and without owing the bank any money. You can relieve yourself and your family of the bad investment, the stress, and the financial burden.

The Most Important Thing Is To
Realize That You Have Options
And Not Give Up Hope!

In a short sale, the lender allows the homeowner to list and sell the mortgaged property with the understanding that the net proceeds from the sale may be less than the total amount due on the first mortgage. For example: you bought your house a couple of years ago for $500,000, and decided to take advantage of the mortgage broker's sales pitch and obtained a 100 percent loan. Now, the house will probably only sell for $450,000. You recently lost your job and cannot afford to continue with the monthly mortgage payments. You have missed a couple of payments and the bank is calling to collect.

When the housing market was booming and real estate values were appreciating in the near double digits, short selling was virtually unheard of. But with a slower market and a recession, more and more home owners are looking to this practice as a way to avoid a costly foreclosure. Selling short is definitely better than foreclosure, which stays on your credit record for ten years. If your bank agrees to a short sale, you hire an agent to find a buyer for the house, you sell the house for a loss with the bank's blessing, and, hopefully they agree to eat the loss (although they can still demand you make some kind of payment or share the loss)

The Federal Home Affordable Foreclosure Alternatives Program, HAFA, offers homeowners, their mortgage servicers, and investors an incentive for completing a short sale. If you qualify, HAFA establishes streamlined short sale rules and incentives for both borrowers and lenders to work together to avoid foreclosure. But even if you don't qualify for HAFA, it is still possible to work out a short sale arrangement with you lender.

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Keep in mind that a short sale is a real estate transaction where a selling price of the home is negotiated with the lien holder(s) for less than what is owed by the home owner. However, many properties that are going through the short sale process may have two lien holders and both lien holders must agree to the "short" payoff of the mortgages. It is important to note the seller still owns and controls the property until the short sale successfully closes or the property is foreclosed upon.

Banks would much rather agree to a Short Sale than foreclose on your home. Banks are not in the business of owning real estate. They would much rather assist a homeowner in some other options rather than foreclose on your home. A foreclosure costs a bank between $35,000 to $50,000 dollars in legal costs, carrying fees, and other related costs. A short sale is a far better option for the bank.

This Option is Available For Homeowners Who:

  1. Do Not Qualify For A Trial Mortgage Modification Under The Making Home Affordable Program;

  2. Do Not Successfully Complete the Trial Period For Their Modification;

  3. Miss At Least Two Consecutive Payments During Their Modification Period; or

  4. Request A Short Sale Or Deed-In-Lieu Of Foreclosure.

For all homeowners who are upside down and can no longer make their mortgage payment (because i.e. of a job loss, divorce, or an option ARM that's resetting higher), up to now the only option was letting the bank foreclose. Many borrowers who are falling behind on their payments are doing so due to the resetting of their ARMs to a higher rate. Housing experts predict that, with so many adjustable rate mortgages adjusting to higher rates, in the coming months we'll see a sharp rise in the number of foreclosures.

For the rest of this article please go to

Short Sale Help, Part II

Short Sale Help, Part III

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To learn more about Avoiding Foreclosure click on one of the links below:

All Things Avoiding Foreclosure Help

Avoid Foreclosure Help Inquiry Form

Avoiding Foreclosure Help: Deed in Lieu of Foreclosure

Avoiding Foreclosure Help: The Home Affordable Foreclosure Alternative Program

Avoiding Foreclosure News

Avoiding Foreclosure Respresentation Agreement

Avoid Foreclosure Relief - Small Steps Can Make a Big Difference

Understanding Robo-Signing, Part I

Understanding Robo-Signing, Part II

Understanding Robo-Signing, Part III

All Things Loan Modification

Loan Modification: How It Works

Loan Modification Under HAMP, Part I

Loan Modification Under HAMP, Part II

Loan Modification Under HARP, Part I

Loan Modification Under HARP, Part II

Loan Modification Our Services

Short Sale Help, Part I

Short Sale Help, Part II

Short Sale Help, Part III

Short Sales Help FAQ, Part I

Short Sales Help FAQ, Part II

Short Sales Help FAQ, Part III

Short Sales: Our Services

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