Wilmington NC Short Sales – Important Information Homeowners Should Acknowledge PART ONE
There are a large number of homeowners who have been led to think that the perfect way to avoid foreclosure and walk free from a mortgage without owing a dime is simply by using a short sale. Much of this type of thinking is gaining traction simply because of a lot of confusion that has occurred when it comes to strategies used in real estate. This may be true in part; however the short sales process is not as simple as some people may think.
Short selling is an option some homeowners use when the bank, credit union or other type of mortgage lender they have borrowed from provides them with the option of selling their home to a third party (generally the lender) at a price that is much lower than what they actually still owe on the note of their mortgage. The short sales process is one that is often used by homeowners who are trying to avoid getting caught up in a foreclosure. Thus, receiving approval from the lender to short sale allows them the opportunity to sell their property at a significantly lower rate. It is also important to compare short sales and foreclosures to ensure you are making the right decision.
To most people, it sounds rather strange for any type of lender to be willing to accept a lower amount from homeowners than what they truly owe on their home. There is more than just one reason why a bank chooses to accept short sales. The key reason is, simply put, that a short sale costs them much less than what a home foreclosure would. The expense banks already have to consider from foreclosures is astronomical. They will also be able to supply you with information in regards to benefits received from short sales. However, when they provide homeowners with the option of short selling, they are then able to recover at least a partial amount of what they would otherwise completely end up losing. When a bank has several mortgages that are non-performing, the Federal Reserve will often lower the amounts or even suspend funds they provide to these lenders.
There are also two different options in regards to short sales that a credit union, bank or other lender might offer. Before attempting the short sales process, it is vital to find out which one it is that your lender offers to homeowners. These options are as follows:
1. Deficiency Judgment – In using this type of short sale option, the homeowner will be held liable to pay whatever difference there may be in short selling and the balance of their mortgage loan. It is important to note that short sales information of a deficiency judgment will stay on a homeowner’s credit report until the balance is paid. Short sales of this nature frequently take numerous years to pay off, as the balance generally equals thousands of dollars.
2. Payment in Full w/out Pursuit of Deficiency Judgment – This particular type of short sales option is the most popular choice among most homeowners. They do not have to worry about moneys that are required above the amount their property is sold. This means they are free and clear of obligations after the process is complete of short selling their property.If the process of short sales is something you must consider it is necessary to contact the bank as soon as possible to gain short sale information on the type of options that are available to you, along with information in regards to short sales vs. foreclosure
WILMINGTON NC SHORT SALE EXPERT