Will a Short Sale be Your Answer?
January 21st, 2009 // 12:45 am @ admin
Are you looking to purchase a home but are wondering if a short sale home is for you? The main reason people look for short sales homes are that they can purchase a home at a substantial discount. The lending company wants to get as much money back on the loan they gave to the person that is now facing foreclosure. Foreclosure is an expensive endeavor whereas the lending company and the homeowner both suffer. With a short sale, the lending company may offer all kinds of financing terms to the new owner along with a short sale keeping a foreclosure off the credit history of the homeowner. In most cases, a short sale is one that will benefit the lending company, the seller, and the new owner all at the same time.
The seller does not want to have a foreclosure on their credit report and they would love to be able to move and keep their belongings. The lending company, of course, does want all the hassles of selling the home, as they are not in the business to sell real estate but to provide loans. Therefore, in most cases, you will have cooperation from both the seller and the lending company.
One thing you must remember, on the other hand, that purchasing short sale homes is not something you should do on your own. You also cannot just pick a real estate agent out of the phone book. Not all real estate agents have the experience to deal with short sales. Short sales have certain criteria that must be met and this situation has to be handled correctly. Remember, the homeowner or seller is in a situation that no ones want to be in – they are losing their home. Going in full force is not the answer. A real estate agent with experience in short sales knows exactly how to negotiate with the seller as well as the lending company to keep all parties happy.
Not all lending companies are going to agree right of the bat. One thing to remember, the lending company by law has the right to pursue for the entire amount of the loan. The lending company has every right to hold the homeowner responsible for every dime of the loan and in some cases, will fight all the way to the end of the foreclosure process to try to receive the full amount of the loan.
On the other hand, most lending companies are willing to negotiate than not in today’s economic situation. There are many homeowners facing foreclosure in today’s market, and lenders are now realizing that a short sale will give them at least the majority of the money owned on the loan in the majority of cases. This will help them clear up the indebtedness of the bad loans while putting money of the books instead of staying in the red.
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Category : Short Sale Questions