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Real Estate Short Sale Questions and Answers |
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Question: What is the process of buying a short sale home?
I am eyeing a house, but does that mean the short sale is owned by the bank? The adverisement in front of the house said the bank owns the house. Currently, no one is living in the house.Answer: smart people do not buy property right now. They wait ...
smart people do not buy property right now. They wait atleast another year for prices to drop the anticpated 25%.Answer: offer a lease 2 purchase. If you offer a no money down and ...
offer a lease 2 purchase. If you offer a no money down and the market goes down you can just walk away or sell your lease 2 purchase contract to a buyer for some quick cash.Question: Whar are the risks of purchase a short sale property from someone filing bankruptcy?
We have agreed on a sales price (the seller has opened escrow) and the seller's lender seems positive, but the seller has just declared bankruptcy and cannot proceed with the sale until they go to court in six weeks. I am interested in learning about any potential risks that we may be taking on.Answer: Check with a real estate attorney on any liens against the ...
Check with a real estate attorney on any liens against the property. If the only lien is the mortgage company, deal with them. Make sure you get a general warranty deed. The sale should be the same day as the title search.Answer: Potential risks - the sale could be held up by the ...
Potential risks - the sale could be held up by the bankruptcy proceedings. Depending on what chapter they are filing, this could go very quickly, or could drag on. Also, the lender has approval authority for any short sale. A lot of them will take up to 90 days to approve a short sale. The houses are usually sold As Is - so make sure your offer will compensate you for any repairs that need to be made. And always expect repairs - maintenance is usually the first thing to slide when owners are in financial distress.
The rewards are you could be getting a great deal, and at the end find yourself with a decent amount of equity in your new home. A comfortable cushion in a declining market, where millions of people are upside down on the value of their homes, and facing similar problems as your sellers.Answer: Be sure your closing attorney is in constant contact with ...
Be sure your closing attorney is in constant contact with the seller's lender & get owner's title insurance.Question: What exactly is a short sale?
I've run into some financial problems and need to sell my home. My sister is part owner of the home but she can no longer pay her part and the mortgage payments on this townhouse are 2 much for me to afford on my own. We are behind 2 mortgage payments at this point and from what our realtor told us a short sale would prob. be best. Would we still have to pay for those last 2 months? cause' at this point were both basically broke. Also, in a short sale.. how much time do you usually get to keep living in your home? and do you still have to keep making payments?Answer: Value of your property is 'short' of (less than) the ...
Value of your property is 'short' of (less than) the proceeds from a sale.
A short sale is when you contingently sell your property to a buyer, then approach your lender and ask for the final payoff (mortgage balance mostly) to be reduced, since the value is lower and the bank may likely face higher costs by foreclosing on you. Length of stay at your home, depends on the terms you might be able to work out with the buyer of the property.Answer: A short sale is when you sell your home for less than you ...
A short sale is when you sell your home for less than you owe. To be successful, your lender must agree to accept less than your payoff amount as full payment for the mortgage. This will show up on your credit report as a satisfied debt. Usually you can get the bank to agree to not come after you for the difference between what you owed on the home and what you can sell it for, but you MUST get this in writing. If that is the case, you will owe nothing (not even the back payments). Typically you will be able to continue living in the house until the sale closes, or possibly 30 days after, if agreeable to the buyer, to give you time to move.Answer: If you have equity in the property then it isn't a short ...
If you have equity in the property then it isn't a short sale, but just a sale. If you have no equity or owe more than the townhouse is worth, then you can ask your lender if you can do a 'short sale'. If you owe $220,000 and the townhouse is worth $250,000, just sell it. After commissions, etc., you'd only break even, but at least you wouldn't owe the mortgage anymore. My guess is that you don't have any equity though...
A short sale means that you will sell the property for less than you currently owe. The bank agrees that this amount will satisfy the mortgage. (for example; you owe $250,000. The townhouse is worth $220,000. The bank agrees to take $220,000 to satisfy the mortgage. You get lucky and find a buyer at $220,000, sell the townhouse and don't owe anything more.). In the past, the difference between the sales price and the amount you owe would have counted as taxable income to you, but a recent bill has suspended that and you wouldn't even owe the taxes on the difference.
This is much different (and better for you) than a foreclosure. In a foreclosure, you fall behind on your payments, the bank notifies you that you have breached your agreement with them. They go to court and get permission to take the collateral (the townhouse). They auction it off. They bill you for the difference between what you owed and what they sold the place for (adding on lawyer's fees, etc.).
In a short sale you live in the house until it sells. Getting a lender to agree to a short sale will also short circuit the foreclosure process.
Your credit is getting trashed as you fall behind on your payments. You need to contact your lender to work something out, whether that is a reduction in your payment or adding the two overdue payments to the balance of your mortgage. If you can get/keep current through the process, your credit won't get completely mangled. There is also a chance that the mortgage company will stop reporting you as late if you are undergoing a short sale.
It's got to be a stressful situation. Take care of yourself and remember that this will be temporary. Don't let the stress ruin your health.
good luck!Question: Has anyone out there actually done a short sale of one of their own properties? How did your credit fare?
I hear there are agencies that can do a sort of letter writing "campaign" of sorts that can clean up your credit.Answer: There are companies that write letters to your creditors in ...
There are companies that write letters to your creditors in an effort to clean up your credit and hope they don't respond, but that is a long shot.
There are no "standards" here, how a short sale effects your credit depends on how many payments were late, how many were missed, etc., etc..Question: short sale?
If you have 2 morages on your home and you sell your house in a short sale and the 1st morage is paid in full and the 2end morage gets no money is the second morage considered a forclosure???Answer: No, but it might be considered income. You might end up ...
No, but it might be considered income. You might end up having to pay taxes on that amount.Answer: If I'm not mistaken the 2nd mortgage can't be walked ...
If I'm not mistaken the 2nd mortgage can't be walked away from ... it won't just go away like if the 1st wasn't paid in full.
You have to pay up :(Answer: No they do not foreclose, they will send a 1099 to the ...
No they do not foreclose, they will send a 1099 to the persona walking away on the 2nd loan. And yes this does mess up your credit. Yes it is considered income, but congress has given a pass to everyone until 2010 but they are trying to change that again so may change again. And yes you do walk away from the other mortgage they will chase you a little and if you buy in the next few years look out for a lien or judgment.Answer: The second has to be settled as part of the short sale. The ...
The second has to be settled as part of the short sale. The second is secured by the property, so it has to be addressed in the short sale. I don't know if it is considered a second foreclosure or just a straight out default.Answer: About foreclosure and short sales, the most complete summary ...
About foreclosure and short sales, the most complete summary guide HERE:
http://buy-a-foreclosure.blogspot.com/
(How to buy a foreclosure, listings, short sales, forecl. apts,
pre-foreclosures, stop foreclosures & foreclosure loans )
Good luck! |
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