There seems to be some confusion in the community about who can qualify for a short sale and what exactly a short sale is. I have heard the term 'short sale' thrown around when working with buyers as well as from sellers. To understand the terms involved, here are some definitions:
Q: When is a homeowner 'short'?
A: A homeowner is 'short' when a borrower owes an amount on his/her property that when combined with closing costs and commission is higher than current market value.
Q: When can a short sale occur?:
A: A negotiation is entered into with the homeowners mortgage company or companies to accept less than the full balance of the loan at closing. A buyer closes on the property and the property is 'sold short'. (Definitions from www.cdpenow.com)The National Association of Realtors reported that 30% of closings this year will be from short sales. That's an astounding amount of people and homes in distress nationwide.
8 out of 10 homeowners go into foreclosure without talking to a Realtor about other possible outcomes.
If you are in a hardship situation and would like to know what your options are, call a Realtor.
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Kristin Moran is a Realtor in San Antonio, Texas & assists homeowners in finding alternative means to foreclosure. 210-313-7397.
Kristin Moran
Specializing in San Antonio & surrounding cities
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RE/MAX Access - Realtor®/Owner
KristinMoran@Remax.net 210.313.7397 www.SistersThatSell.com
Buy a home from me, use the truck to move for free!
Great clarification. The most critical element is that the mortgage company has reviewed all aspects of the owner and concluded they will accept a short sale. I don't know where the idea of some people came from when they think just because they owe more on their home then they can walk to the table that that automatically enables them to receive the lender's permission. If they have the means to pay and money in the bank then they just simply have an obligation to not use the lender as their safety net. Realtors just need to check all the fact out regarding this and I have found that this is one step often skipped and assumed. Thanks for the definitions.
Kristin,
Great post. The statistics are hard to believe.
Ann Hayden in cloudy Wildwood, Missouri
Kristin That is an excellent post - clear, concise and brief - not all tangled up with minor details, Karen
Kristin, Great post. Been thinking about putting something together myself. I am still amazed at the folks who don't know what the difference is between, Short sale and foreclosure.
Kristin, it's great that you posted the details about short sales and to clear up any confusion. I get a lot of questions about what a short sale is as well and also blogged about it for my area! good work!
I have managed to avoid working with short sales until this week.....a surprise to me and the buyers I represent. I'm learning fast!
This is some great Q&A for Short Sales Kristin.
Kristin - Nice concise explanation. It's amazing that in this current downturn, banks began considering short sales immediately. Back in the seventies they would rather forleclose on the owners. Times they are a'changin'.
Kristin,
I like this information in your format! Excellent post!!!
Someone is getting a lot of good information from their class! Mine came, I just need to get started! I am anxious now that I am reading your posts! Thanks!