What is a Short Sale and is it Right for Me?

What is a Short Sale and is it Right for Me

Sellers can be motivated to put their homes on the market for a variety of reasons.? It may be a retired person ready to downsize or someone having accepted a job in a new city.? However, an owner may be selling because he or she is having financial problems.? In this situation, the seller may be considering a short sale.? Whether you are a seller or buyer in Arizona, it can be helpful to ask:? What is a Short Sale and is it right for me?

What is a Short Sale?

Under an ordinary home sale, the selling party will get enough money to pay off the remainder of their mortgage and any applicable selling costs.? When a home is sold on a short sale, this means that the sales price is not enough to pay the balance of the mortgage loan.? The borrower may have financial problems which make payment unrealistic. A mortgage lender may also consider a short sale even if the seller is up-to-date on their note, but the home value has fallen. When a seller owes more than the home?s value, the short sale allows the home to be sold at a price which reflects the market conditions.? When a seller decides to sell the home in this way, the mortgage lender agrees to release its lien even though the mortgage was not completely paid off during the transaction.

Short Sale and Foreclosure

This type of sale allows the seller to avoid foreclosure but does not require that the individual be delinquent on their mortgage payments. Lenders tend to be willing to accept short sales instead of going through a lengthy and expensive foreclosure process. A short sale will allow the mortgage holder to recoup some of their loss and move on faster.

Short Sales are Complicated

Whether you are a seller or buyer, short sales can be very involved.? For the seller, the sales documents have to be drafted very precisely to protect them from liability.? There can also be issues when there are multiple mortgages on the property.? For the buyer, the offering price has to be accepted by the mortgage lien holders.? Additionally, this process can take significantly longer than buying a regular home and lenders sometimes add conditions which are burdensome to buyers. ?For instance, a lender may require the buyer to pay all closing costs or to pay the difference between the sales price and mortgage balance.

A short sale may or may not be a good option depending on your specific circumstances.? If you are considering a short sale having the advice of an experienced real estate attorney and agent is critical.? Attorney Laura B. Bramnick is an Arizona real estate attorney with the expertise you need to evaluate the pros and cons of a short sale and ensure that your interests are protected.? If you are seeking an exceptional, client-driven real estate lawyer and agent in Scottsdale, Phoenix, Sedona and throughout the state of Arizona, contact Laura B. Bramnick to schedule your consultation.

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