Frequently asked Questions
How long will a short sale take?
We tell everyone that it will take 90 days from the time of the offer to get an approval from the banks. Sometimes this happens in 60 days. Some banks are more organized than others and can even pull it off in 30 days. It depends on how many files are in the Loss Mitigation Department and how willing the Lender is to negotiate a settlement amount. It also depends on the number of loans and or liens on the property.
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.
Can I stay in the house?
Yes -the purpose of a short sale is to sell the property, usually to a third party. Stage the home if possible, make it accessible and easy to show by REALTORS®, tell your friends, family, co-workers, pass the word around that you need to sell your home.
Tip: Always answer your foreclosure papers to the court.
How soon should I look for another place to live?
You should probably begin looking for alternative housing immediately. Whether you move in with family or look for a new house or apartment, it may take a while to find a location that matches your family needs. You will have to move whether we negotiate a successful short sale or if the property goes to foreclosure auction. Be prepared!
Can I get money from the sale of my property?
No. It is an universal requirement of lenders granting a short sale that the borrower will not get any proceeds from the sale of the property. The lender is taking a loss on your loan, they are not going to let you get any money.
Do I get to keep the money that I am not paying while the Sale process is ongoing?
Yes, in most cases you can per your hardship situation, but if you have managed to save a lot of money by not paying your mortgage, you may be asked to contribute at closing.
We will surely explain this scenario in person.
What options other than a short sale might I have?
a. Cure your mortgage default (bring your payments current);
b. Attempt a loan modification that adjusts the terms of your existing loan;
c. Refinance your mortgage with another lender;
d. Try to sell your home through normal channels;
e. Attempt to get your lender to accept a deed in lieu of a foreclosure; and/or
f. File for bankruptcy.
How do I know this will work?
There are no guarantees. We cannot make a promise that we can reach a settlement with the lender on your behalf. Once you missed the payment, the lender is in charge and can proceed to foreclosure if they choose. Lenders most often choose to work on a short sale instead of having to foreclose and possibly take ownership of your house, as both are costly.
What happens if it doesn’t work?
Your property will probably go to foreclosure and an auction will be held. If the lender’s price is not matched, then they take back the property as an REO (Real Estate Owned).
They can go after you for legal fees and any deficiency on the loss.
What are deficiency judgments?
A deficiency occurs when the bank is owed more than it gets. Banks have numerous means to pursue on recourse loans. One result is that the bank can sue and obtain a deficiency judgment. Then the bank can garnish wages, seize assets, etc. This is a perfect reason why a short sale is better and why you need a REALTOR® and negotiator that knows how to keep you out of this mess.