If you’re struggling to pay your home mortgage, you can avoid destroying your credit and going into foreclosure by opting for a short sale. And, if you’re looking to purchase a home soon, you can expect to pay fair market value when you purchase a home on the short sale list.
What is a short sale?
In real estate, a financially distressed homeowner can satisfy the lender (bank or mortgage holder) by conducting a short sale. A short sale means you’re willing to sell the property for less than what’s due on the mortgage. The third-party buyer (typically not a bank) will give all the funds they are paying to the lender.
In return, most lenders (in most states) will forgive the difference between the short sale price and the mortgage value. A few lenders will choose to recoup the difference between the sale price and the original value by placing a deficiency judgment against the borrower.
Short sale benefits
Once a homeowner has gotten three months behind in their mortgage payments, the likelihood of catching up grows dimmer. Instead of suffering foreclosure, many people choose to downsize to more affordable housing. Short sales are also suitable for older homeowners who are struggling with home maintenance, repairs, and mortgage payments.
Here are some benefits for anyone who is looking for a real estate investor to start the short sale process:
- The buyer will avoid the risks associated with buying a foreclosed property.
- The seller can leave the home gracefully, avoiding the stress of foreclosure.
- The mortgage holder will reduce their losses with a buyer paying fair market value.
- All other transactional parties will also be paid from the proceeds of a short sale.
If you’re interested in alternative solutions to sell your house quickly, contact us today at The Easy Home Buyer.
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