THE SHORT SALE PROCESS

As we know short sale occurs when the lender agrees to discount a loan balance and accept less than the total amount due incident to the sale of a home due to financial hardship and I all ready discussed about short sales in my previous posts. So i will talk about the short sale process?

Short Sale Process: - Once homeowners find themselves in a circumstance where their home is worth less than the mortgage balance this is just the beginning of the process to be contacting the lender to see if the property qualifies for a short sale. If the owner/borrower has other assets which would enable them to pay off their mortgage, then the lender will not approve the short sale and could get a deficiency judgment against the homeowner for the difference of the amount owed on the loan and the sale price of the home. The first and most practical step would be to seek the assistance of a competent real estate short sale agent who should be specializes in bank short sales and the short sale process. While each lender has their own specific requirements there is a consistency in the nature and type of documentation that can be expected. Working with an experienced shortsalesafe.com is good move in getting your short sale approved with no deficiency judgment.

Hardship Statement is a written statement which describes for the lender what has changed making it difficult/impossible for the homeowners to continue paying their current mortgage, due to lost a job or had a significant decrease in income, was hospitalized or had some other unexpected illness or medical emergency contributing to their problems.

Statement of Income will require a hardship letter and proof of the financial statement outlining all liquid assets, including savings accounts, checking accounts, money market accounts, stocks, bonds, cash and other real estate. Obviously this statement needs to be consistent with the facts outlined in the hardship statement in order for a lender to seriously consider the request.

The advantage of a short sale is that the owner can save their home from foreclosure and their credit. The seller simply walks away at the closing not owing any money on their mortgage. Of course, they have lost their equity in the property by that time.