Financial difficulties such as struggling to make mortgage repayments can leave you feeling helpless. This is where a short sale can be the first step to financial freedom. The relief of getting out from under an unaffordable mortgage can help kick start a new chapter for you and your family.
What is a Short Sale
A short sale is the sale of a property that has outstanding debt that is greater than its sale value. A key part of this process is that the owner works with the bank to sell the property for less than the value of the debt owed.
A short sale is typically agreed upon, as the bank understands that the owner will likely default on the loan, causing the property to become bank-owned and move to a costly foreclosure process. This is not ideal for either party. By having a short sale, the owners can often preserve their credit and avoid bankruptcy.
Obtaining the right representation can be instrumental in the success of the short sale of your property, as they act on your behalf not only listing the property but also negotiating the best possible contract terms. With experience settling countless short sales, Ohio Short Sale Center will work hard to ensure after a short sale, you can start fresh.
A Short Sales Aren’t Always Quick
A ‘short sale’ doesn’t refer to the time involved. With three parties involved in the process, the buyer, seller and the seller’s lender, finding an agreed-upon price can be a lengthy process. Exactly how long is hard to quantify, but it can generally take several months from start to end.
Typically an interested buyer makes an offer in line with the current property value, the proposal is then drawn up and passed onto the seller’s lender. The lender must be the one to approve the final offer, as it is to be accepted at a lesser amount than the debt owed. If they do not accept the offer, it is back to the drawing board, starting the process over again.
A Short Sale Won’t Always Leave You Debt Free
While getting approved for a short sale will put you in a better financial situation, than if you were to be foreclosed on. It does not guarantee that you will be free of all debts.
In some states, after the short sale, the lender can seek a personal judgment against you to recover the deficiency amount. While in many states there is legislation that prohibits a deficiency judgment following a foreclosure. Unfortunately, most states do not have a corresponding law that would prevent a deficiency judgment following a short sale.
A common reason that short sales fail to close can be problems in finalising the documentation. Leaving items out or submitting incomplete or incorrect documents can result in delays to the process and endanger the sale’s potential to be approved.
That is why it is incredibly important that in deciding on a short sale for your property, that you select a qualified and experienced real estate professional to assist you in the process. Providing you with the help you need, to let go of that stress and move forward with the rest of your life.