Hi, I’m Derik Lewis from Lawyer’s Realty Group. We’re located the Southern California area and are here to help you navigate the tumultuous real estate and short sale market. Today I’m discussing short sale transactions on your property.
A short sale is basically the sale of your property for an amount that doesn’t pay any outstanding mortgages or liens. That means you’ll need lender approval to do a short sale.
Many people ask why a lender would approve such a thing. If they don’t do a short sale, their other alternative is to foreclose on the property. If they foreclose, most of the time they are going to become the owner of the property and are responsible for maintaining it and paying all of the taxes and insurance, all in an effort to sell the property to a new buyer. If you are able to bring a buyer to the table and conclude a short sale that gets them as much as they would get after foreclosure, they are usually willing to cooperate and avoid the hassle.
People also wonder why an individual would want to short sell their home. One reason is that individuals get to avoid a public foreclosure and a public eviction process; you don’t want to see these on your credit. A short sale won’t have as much of an affect on your credit as foreclosure will and it will allow you to purchase a home again sooner than a foreclosure would. The number one reason that people usually do a short sale is to have the ability in that process to negotiate away deficiencies and liabilities from second lien holders, lines of credit and outstanding HOA fees. In a short sale you can negotiate and use the buyer’s funds to hopefully pay them off. If you go to foreclosure, a number of creditors will have the ability to sue you for the balances.
Take a look at our website where we have plenty of resources about traditional real estate and short sale transactions. As always, if you have any questions about short selling your home or you need assistance, please contact us at Lawyer’s Realty Group.