Short Sale Information

WHAT IS A SHORT SALE?

Definition

A “Short Sale” is when the lender agrees to accept a payoff less than the remaining balance of the mortgage. The lender or servicer may forgive the entire shortfall, as well as pay the seller’s closing costs, past due taxes and all Realtor fees or commissions. Through negotiations, the loss may be written off by the lender. Sometimes, the lender will require a much smaller lump-sum cash payoff or make agreement with the borrower for payments (promissory note).

Background

Foreclosures, defaults and delinquencies for mortgages are happening at record levels. Many are due to “pick-a-payment”, teaser-rate mortgages or interest only mortgages that are adjusting upwards. The results of the current economic downturn, higher taxes, job losses and increased insurance costs are making it increasingly difficult for borrowers to keep up with these payments. The impact in Alameda, Contra Costa and San Joaquin counties has been extensive. With lower prices, many owners have negative equity (owe the lenders more on the mortgage than their properties are worth). Often, in this case, and the borrower needs to sell, one option is a "short sale".

Why Would Lenders and Servicers Accept Short Sales?

Lenders, banks and investors don't want to own homes and properties. Foreclosure costs can be as high as $30,000 to $50,000 for lenders and services. They have to pay to foreclose, maintain market, insure and provide utilities for the foreclosed properties, then spend money on closing costs. In cases where they cannot work-out a payment solution (loan modification, forbearance, etc.) a Short Sale is their best option. Also, due to newly launched initiatives under the Obama administration such as the Foreclosure Alternatives Program (FAP) and the Making Homes Affordable Loan Modification Program, lenders and servicers are provided incentives to complete short sales.

We Are Skilled Short Sale Negotiators

Each member of the HopeOptions4You team are trained, certified experienced short sale negotiators and can help you understand the process and evaluate if the short sale option will work for you. Every borrower’s circumstances are unique including lenders, quantity and types of loans and borrower’s hardship and financial situation.

No Cookie Cutter Solutions, We Know Each Situation Is Unique

If we can help please feel free to contact us. We would love to talk with you face to face to discuss the options available to you. We also recognize that every situation is unique and has special circumstances. We don’t have a “cookie cutter” approach to your situation and each circumstance is different. Each loan, family and situation is unique and “one size does not fit all.” We will treat you as a person and will give you the best our team has to offer.

We would love to help you discover the options and the best option for you- but talk with an attorney and/or tax expert before, during and after talking with us to make sure you know how your decision(s) will impact you now and in the future.

CONTACT US
To receive more information or schedule an appointment please fill out this contact page or simply call us directly.

Last Updated ( Thursday, 18 June 2009 )