A short sale can help a homeowner in foreclosure. When there is no hope that a homeowner can pay his or her mortgage payments, a real estate short sale may be a viable solution for the homeowner. You do not have to be late on your mortgage payments to begin the short sale process. Learn about what is a short sale and consult a Realtor early about the possibility of doing a short sale when you think that you might not be able to keep up with mortgage payments in the near future.
Understanding What a Short Sale is
A short sale is defined as a real estate sale in which the proceeds from the sale fall short of the balance owed on a loan secured by the house sold. In a short sale, the bank or mortgage lender agrees to discount a loan balance because of an economic or financial hardship on the part of the mortgagor. This negotiation is usually done by communication with a bank’s loss mitigation department.
Stopping Foreclosure
A short sale is often executed to stop the foreclosure process. Often a bank will allow a short sale if they think that it will result in less financial loss than going through with the foreclosure process as there are carrying costs associated with a foreclosure. A short sale is often faster and less costly than a foreclosure. In short, a short sale is just a process of negotiating with lien holders a payoff for less than what they are owed, or rather a sale of a debt, generally on a piece of real estate, short of the full debt amount. The process does not wipe off the remaining loan balance unless settlement is clearly indicated on the acceptance of offer.
Learning about Short Sale
There are many books on the subject of short sale. Some books are for homeowners who are in foreclosure. These books explain to them what a short sale is and how it can help them save their properties from foreclosure. There are also books for investors wanting to take advantage of the foreclosure market. Foreclosed homes are usually cheap so new home buyers and new real estate investors can buy them fairly easily. Examples of books on short sale are The Art of the Short Sale, Short sales: An Ethical Approach, Doctor Foreclosure: The Secret to a Successful Short Sale, and Short Sale: A Practical Approach.
