What You Should Know About Short Sale
Sometimes the owner of a property is no longer able to pay the mortgage or deed of trust. When this happens, foreclosure often follows -or worse: bankruptcy. But there is an alternative, the short sale.
Not all lenders will sign a short sale. This is because signing it means agreeing to be paid an amount less than what's due. The lender will be accepting a discounted payment for what they've lent out, in effect, forgiving the remaining deficiencies of the trustor or borrower. Of course, not all lenders will take a short sale -since pursuing foreclosure and taking the property as collateral will certainly make more financial sense.
That's right, the lender agrees to accept payment that's considerably less than the total amount that's due. Not every bank or lender will accept a short sale -of course it would make much more financial sense to pursue foreclosure and just take the collateral.
Also, see your accountant -the IRS may count debt forgiveness as considerable income, be wary of the tax ramifications involved. Another good reason to consult your lawyer is that the lender may still legally pursue you for the unpaid debt.
The tedious process of securing a short sale is sure to take a very, very long time. 21 days is the usual answer, should you ask the lender. But that's just a minimum, some cases may actually take twice that time to get approved.
Not just for nonpayers, those who have never once paid a single installment can also avail -thanks in part to their negative equity. To short sell is to get out of a very rough and highly threatening financial situation, take it when you need it and take it if you can.
The process: The contract, authorization to release, and the addendum -these are the key parts of the whole short sale process, topped off with the warranty deed. Here we'll take a closer look at the contract and the addendum:
The process is quite simple to understand, it starts with the contract, then the authorization to release, and lastly the addendum. The warranty deed is also part of this whole process. What are really important to grasp in the process is the first two documents:
The Addendum- Your Most Important Tool
The basic document that contains nearly all vital info on conducting the transaction is contained in the addendum:
Info on the origin of the contract for short sale
The Date
Names of the parties involved
The address
Tip: It's best to use both the simple address and the legal address.
Any good investor should be aware that a short sale is a good way to peruse quality bargain real property -a case in which a short sale is actually more financially reasonable than outright foreclosure. - 23199
Not all lenders will sign a short sale. This is because signing it means agreeing to be paid an amount less than what's due. The lender will be accepting a discounted payment for what they've lent out, in effect, forgiving the remaining deficiencies of the trustor or borrower. Of course, not all lenders will take a short sale -since pursuing foreclosure and taking the property as collateral will certainly make more financial sense.
That's right, the lender agrees to accept payment that's considerably less than the total amount that's due. Not every bank or lender will accept a short sale -of course it would make much more financial sense to pursue foreclosure and just take the collateral.
Also, see your accountant -the IRS may count debt forgiveness as considerable income, be wary of the tax ramifications involved. Another good reason to consult your lawyer is that the lender may still legally pursue you for the unpaid debt.
The tedious process of securing a short sale is sure to take a very, very long time. 21 days is the usual answer, should you ask the lender. But that's just a minimum, some cases may actually take twice that time to get approved.
Not just for nonpayers, those who have never once paid a single installment can also avail -thanks in part to their negative equity. To short sell is to get out of a very rough and highly threatening financial situation, take it when you need it and take it if you can.
The process: The contract, authorization to release, and the addendum -these are the key parts of the whole short sale process, topped off with the warranty deed. Here we'll take a closer look at the contract and the addendum:
The process is quite simple to understand, it starts with the contract, then the authorization to release, and lastly the addendum. The warranty deed is also part of this whole process. What are really important to grasp in the process is the first two documents:
The Addendum- Your Most Important Tool
The basic document that contains nearly all vital info on conducting the transaction is contained in the addendum:
Info on the origin of the contract for short sale
The Date
Names of the parties involved
The address
Tip: It's best to use both the simple address and the legal address.
Any good investor should be aware that a short sale is a good way to peruse quality bargain real property -a case in which a short sale is actually more financially reasonable than outright foreclosure. - 23199
About the Author:
Know about short sale an alternatives to bankruptcy or foreclosure only at Don Burnham's website http://www.weknowthewayback.com. Visit today to know all about short sale!
posted by X - Men @ 12:38 AM
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