Call me today at 480.236.2796 to find out how you can:
Recovery Home Loan Program:
Allows borrowers to short sale their current home and purchase a new home
Many homeowners are faced with the decision to short sale their home when it is upside down in value. Some lenders are agreeing to allow its borrowers to short sale their homes without missing a payment. The Real Estate Recovery Home Loan Program is designed for the borrower to short sale a home and immediately be eligible to purchase a new home.
Guidelines to Recovery Home Loan Program:
What is a short sale? A short sale is the sale of real estate in which the proceeds from the sale fall short of the balance owed on the property's loan. A lender typically agrees to discount a loan balance to prevent a foreclosure but the decision to proceed with a short sale is predicated on the most economic way for the bank to recover the amount owed on the property. Often a bank will allow for a short sale if they believe that it will result in a smaller financial loss than foreclosing.
How is a seller's credit affected by a short sale? Expect to suffer some credit score damage, but nowhere near as much as a foreclosure. Loss of FICO points can be around 75-125 and your report will show it listed as a 'pre-foreclosure in redemption' which can be far less negative.
Do I still have to pay an agent commission to list my home as a short sale? No, when you sell your home through a short sale, the bank pays the commission fees for both the seller and buyer's real estate agents.
I want to do a short sale and have a 2nd mortgage, does this make me ineligible? No. Both of your lenders will need to be satisfied in some way to complete the short sale. If your first lender will be paid off by the sale, then you just negotiate the terms with the second lender.
If I pay mortgage insurance and default on my loan, why wouldn't that cover the deficiency amount? In some cases it will and in some cases it won't. It depends on the amount of deficiency. Usually the mortgage insurance only covers a certain amount. Moreover, the lender will try to collect from you before they file a claim with the mortgage insurance company. The mortgage insurance is not there for your protection, just the lender's.
I am current on my mortgage; will my lender consider a short sale? The answer is, maybe. Some lenders will accept a Short Sale file for approval on loans that are not delinquent. Other lenders will not accept the file until the loan is delinquent. We can put your Short Sale file together within a couple days and submit it for approval. That is the best way to determine if your lender will accept a file for approval on a loan that is current.
Are short sales guaranteed to work? No. All of the criteria must be met before a bank will even consider a short sale. Even then it isn't easy to convince a bank that the market value of the home is lower than what they are owed. Even if all of the paperwork has been correctly completed it can take several weeks, or even months, only to be denied. If the lender does not approve the short sale, no transaction occurs.
For questions or additional information on selling your home as a short sale, email or call William May at WilliamDMay@msn.com or 480.236.2796
