What is a short sale?
How does a short sale work?
A short sale is when a lender accepts a discount on a mortgage to avoid a possible foreclosure auction or bankruptcy. A Short Sale allows you to sell your home to a third party at a price which is less than the total amount that you owe. If you are not sure what to do, it is important to remember that the sooner you sell your property, the quicker you are free of the burden of the property. This avenue is open for homeowners who are willing to part with their property but keep their credit rating with the least amount of negative reports.
The lender will require a written contract with you and the buyer, a HUD-1 or settlement statement of the sale, possibly a buyer assurance letter stating the potential buyer is approved for the new loan, financial information from you showing that you can't afford the house. We have successfully negotiated short sales for many home owners and we know what documentation the lender needs for approval and in what order.
If you are willing to sell your home or currently have your house on the market, some lenders might agree to put your foreclosure on hold while you attempt to sell your home through traditional real estate methods. Of course, that all requires time. That is why it is important to determine if your best plan is to defend the foreclosure thereby allowing you to effectively "buy time", giving you and your professional team enough time to sell the property.