I have been working in avoiding foreclosures and short sales for over three years now. In the early days of this crisis, I would spend a lot of time describing the definition of a short sale to Realtors and home owners! These days, most know the basics of short sales and I talk with them about the details and benefits of going this route.
I work as a Realtor and Investor and help people nationwide to find different ways of dealing with difficult real estate situations. Most I talk to have less money coming in, their payments are going up, and their real estate has dropped in value.
Solutions: Well, most people start with talking to their bank and trying to get a modification on their mortgage. This can work, but in my experience, most of the time the reduction in payments are not enough to help them out of their situation. Also, the banks are strict on how much income you may have in order for them to do a modification. A lot of people have too little coming in.
A second way that we may suggest is legal foreclosure defense. A lawyer looks over your mortgage documents and makes the lender come up with all the proper paperwork. This can delay the foreclosure for a long time!
Usually, even going through these actions, it will come down to a foreclosure or a short sale. Usually the short sale is much better for the home owner than a foreclosure. The credit is hurt much less and the debt to the bank can often be dismissed!
There are a lot of people who are in what I can the \”standard\” position. This is someone who has lost their job and/or have lower income and their home has lost a LOT of value and the mortgage payment has gone up. Often, people want to try to get a mortgage modification in order to continue paying lower payments and stay in their home. I totally agree with this as a first tactic to use. BUT, the end result is usually too little a decrease in payments and they end up right where they started.
If these don\’t solve the problem, you can move to a short sale. This will allow negotiation with the bank and a sale close to today\’s market price. The owner can find a cheaper way of living and a fresh start. The deficiency amount and tax can usually be dismissed! The short sale is much better than a bankruptcy or foreclosure! They can leave the owner with money that still has to be paid over many years and tax liabilities! There are many lawyers that can help.
Learn more about short sales. Stop by Daniel Wolkoff\’s site where you can find out all about avoiding foreclosure and what it can do for you.
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