Facing Foreclosure You May Have A Way Out

Facing Foreclosure You May Have A Way Out

There are countless hardships that can turn home ownership from a joy into a burden. The loss of a job, student loans, medical bills, or an unexpected hike in monthly payments can all make a mortgage unaffordable. But Image titleignoring the bills will not make them go away, it will only make things worse.

If you need help, there are approaches that can help, but you may not be familiar with them. One of these is a “short sale.”

A short sale is an “arrangement” between the current owner of a home and the bank that lent them the money to buy their home to accept an offer for less than the total amount owed to pay off the home. The “deficiency” is the difference between the amount owed and what the bank collects at the short sale.

Although, the “arrangement” can take many different forms, there is no other definition of a short sale. I say this because many realtors and some investors simply throw the term around as if it meant “a sale under market value.” No. A bank owned (foreclosed) house is not a short sale. A seller deciding to lower their price and take less profit is not a short sale. An old lady that owns her home free and clear, selling a $150k home for $75k, IS NOT A SHORT SALE. For it to be a Short Sale, someone must be getting “shorted.” Either the seller, or the bank. 

Another important definition of a short sale is how it differs from foreclosure. In foreclosure, the homeowner falls way behind on their payments and the bank repossesses the house and sells it. In almost all cases, THE BANK PURSUES THE HOMEOWNER FOR THE DEFICIENCY!!! No one seems to know or believe this, but just ask someone who has gone through foreclosure, they will tell you the only way out of this was to file bankruptcy.

How It Can Happen – The Arrangement Most short sales arise when a seller owes more on their house than they can sell it for (upside down). The owner of the home then attempts to make an arrangement with their lender to sell the house for less than is owed.

The term “arrangement” was used in the definition and is intentionally broad because the arrangement depends on the bank that holds the loan. Though there are general practices, every bank does it differently.

If you would like to explore the possibility of a short sale for your property, avoid foreclosure, and potentially save your credit rating, please call Ron NOW!!! (254) 702-0064 Time is of the essence.

Blog submitted by: Ron Cooks of The Real Estate Market Place – Servicing the Greater Fort Hood area which includes: Killeen, Harker Heights, Temple, Belton, Copperas Cove and Nolanville. Feel free to call Ron at (254) 702-0064 if you have any questions regarding Central Texas Real Estate.

For Real Estate Listings in Central Texas visit my website at: www.mykilleenhome.com or if you’re on the go text  'Ron' to 254-227-5799

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Phone: 254-702-0064
Dated: December 13th 2015
Views: 581
About Ron: I’m a retired Army Warrant Officer that served our nation for 25 years. I was born and reared in ...

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