Common Questions & Answers
Question: How can I save my home from foreclosure?
Answer: There are a few things that can be done to avoid a foreclosure sale. 1) The homeowner pays any and all delinquent debt owed to the mortgage company and/or secured creditor initiating the foreclosure sale. 2) The homeowner contacts the mortgage company and/or secured creditor to request a remodification of their loan and monthly payments. 3) The homeowner hires a real estate agent to list their home on the market for a traditional sale. Or 4) The homeowner contacts the mortgage company and/or secured creditor to request a short sale of their home.
Question: What is a short sale?
Answer: A short sale is negotiating a lower price for a home than what is owed to the lender.
Question: Why should I choose to do a short sale?
Answer: A short sale would be highly recommended to a homeowner should they need to sell their house quickly and/or there is no equity in the home.
Question: Are short sales guaranteed to work?
Answer: No. It is the decision of the mortgage company and/or secured creditor (initiating the foreclosure sale) to grant the work-up and approval of a short sale. However, it is often in the creditor's best interest to perform a short sale on a home than to allow the home to go to a foreclosure sale.
Question: Is there any cost to me (the homeowner) should I choose to do a short sale on my home?
Answer: In many cases, there is no cost to the homeowner to perform a short sale on their home. Homes (going through a short sale) are sold in AS-IS condition and the bank and/or new buyer of the home typically absorbs all closing costs.
Question: Will I make a profit from a short sale?
Answer: No. Banks will not agree to do a short sale should they discover that the homeowner is making a profit from the sale. The sole purpose of a short sale is to assist a distressed homeowner from facing foreclosure. Banks and secured creditors do not allow the work-up and approval of a short sale should they discover that the distressed homeowner is going to make a profit. Many mortgage companies may give a moving allowance to the homeowner should the short sale complete successfully. The amount of the moving allowance (as well as the mere existence of it) varies between each mortgage company.
Question: Am I able to stay in my home while the short sale is being negotiated?
Answer: Yes. It is MANDATORY that the homeowner remains in the home throughout the entire duration of the short sale. In many cases, a bank will NOT negotiate a short sale on a home should the homeowner choose to relocate before it is sold. The homeowner must show that they still have an interest in the property by not relocating before the sale is complete.
Question: If I choose to do a short sale, will the bank continue to contact me regarding delinquent payments?
Answer: Yes. The mortgage company and/or secured creditor will continue to contact the homeowner in an attempt to collect delinquent payments on the loan. Please note that the collections department of many companies are calling about delinquent payments. The homeowner should not receive calls regarding delinquent payment collection from the short sale negotiating team that will be handling the file.
Question: How will a short sale effect my credit?
Answer: A short sale can decrease a person's credit score. But, the amount of a score decrease varies from individual to individual. Much of the credit score's decrease is determined upon the number of payments missed (if any). However, the long-lasting effects of a short sale posted on one's credit report is much better than a foreclosure.
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