Short Sales
The name Short Sale came from the fact that the Lender’s payoff is coming up “short”. It occurs when a Lender agrees to the sale of a property for less than the amount owed on a mortgage. Purchase and Sale Agreement (from Realtor), Addendum to Purchase (from Realtor), Authorization to Release Information, Two Years FULL Tax Returns , Two Months Bank Statements (Most recent), Last Two Pay Stubs, Fill Out Financial Worksheet, A Handwritten Hardship Letter, If FHA, Form 90036 and Homeownership Counselling Certificate include a short sale package.
With short sale, the rest of the homeowner’s debt is forgiven. Rather than suffer the lengthy and expensive foreclosure process, a homeowner agrees to a short sale though the sale of your Dripping Springs home, for instance is less than the owner owes on the mortgage.
Foreclosure is definitely not the only option. Short Sales are good options. For one, a potential buyer will get the home at a reduced price. Then, the seller will not face bankruptcy but will get out of the mortgage liability. On the hand, the lender will not be facing the arduous protracted process of foreclosure even if he agreed to a loss from accepting a short sale.
Although a better option than foreclosure, waiting for the lender to agree to a short sale can be lengthy and hard. But if you’re on the way to short sale your Homes for Sale in Dripping Springs, Realtors advise that you seek help from a real estate agent short sale expert. Here’s what they say:
1. Check if the indeed the Lender agrees in writing that all debts in the short sale process was forgiven.
2. Make things clear with the Lender how the short sale will be reported on your credit report. Take note that even if the short sale is marked as ‘settled for less than the full balance,’ this could still show a negative mark on your credit report.
3. Make certain that you are well-informed about the tax repercussions.. So, if your Dripping Springs home was agreed to a short sale for $30,000 less, then a 1099 for $30,000 will be issued by your lender and you would have to pay taxes on.
Short Sale, as Realtors say, is a win-win situation. If you ever decide to buy another home, short sale has an advantage over foreclosure.