Short Sale vs. Foreclosure

We get a lot of questions about short sales, so I thought I would share some information this morning. A short sale is when the bank allows a payoff "short" of their lien amount in order to get the home sold. I appreciate the allure of the short sale from a buyer's perspective, in that you can often get a great deal on a home. However, we also have to remember that a short sale can be a very long, drawn-out process. We jokingly refer to them as "long sales" because bank approval on offers sometimes takes weeks, and usually months, of waiting. It's even possible you may not receive any response from the banks, especially if you really low-balled your offer. So you have to be patient,a and wait it out, and not be in a hurry to move.

What if a seller is in financial trouble? Why should they go through a short sale, and endure a foreclosure?

The primary benefit of going the short sale route is that typically with a foreclosure, the bank will pursue a deficiency judgment against you for the unpaid balance of the mortgage. With a short sale, your debt is often forgiven, and the seller will also avoid the devastating effects on their credit that comes from a foreclosure. A short sale damages your credit, a foreclosure destroys it.

So what all goes into buying or selling a short sale?

Most importantly, you need agents on both sides of the deal that are knowledgeable in the short sale process. If they don't have experience, the sale will be compromised and could end up falling through. As an agent with a lot of experience in working with short sales, I can tell you that it is imperative to have someone representing you that knows how to do the job. In all reality, your success in a shorts ale deal is almost 100% dependent upon the ability of your agent. They should know how to deal professionally with the banks, as well as the other agents. But remember, even experienced agents like myself are, unfortunately, still at the mercy of bank employees. As a short sale expert, please call me today so we can help you get your home sold quickly or find you the right home!