Short sales are extremely complicated real estate transactions. As a Home Affordable Foreclosure Alternative (HAFA) short sales specialist, Phyllis Harb has been specially trained to manage short sale transactions. In certain instances, (HAFA) allows home sellers to have the terms of the short sale approved prior to listing their home for sale.
Although each lender and servicer have different criteria, let’s review the most common eligbility requirements:
- Property is borrower’s primary residence
- The mortgage is delinquent, or default is reasonably foreseeable
- The borrower’s total monthly payment (PITI = principal, interest, taxes and insurance) exceeds 31% of the borrower’s gross monthly income
Short Sale versus Foreclosure, what are the benefits?
- Borrowers are typically released from future liability by the first mortgage
- In certain circumstances, the homeowner may receive up to $3,000 for relocation assistance
- Foreclosure will not be reported on credit
Other Options for distressed homeowners:
- A loan modification is a change in the original terms of the loan, perhaps a lower interest rate or an extension of the loan term. A change which will result in lower monthly payments. If you have previously tried a loan modification without success, servicers are now more motivated; try again. Beware of Foreclosure Rescue Scams – Help Is Free.
Deed in lieu of foreclosure: According to Wikipedia, A deed in lieu of foreclosure is a deed instrument in which a mortgagor (i.e. the borrower) conveys all interest in a real property to the mortgagee (i.e. the lender) to satisfy a loan that is in default and avoid foreclosure proceedings.
With over ten years in mortgage banking and twenty years selling real estate, Phyllis Harb is uniquely qualified. How Phyllis can help you:
- Confidential no obligation consultation to review your current financial situation and advise you on your options.
- If you are a likely short sale candidate, Phyllis will prepare a detailed market assessment. After establishing your asking price, your home will be listed for sale in the multiple listing service.
- In the best of circumstances, selling a home is very stressful. Phyllis will communicate with you at least twice weekly, via written status reports and telephone conversations.
Contact Phyllis for a confidential consultation about your specific situation. Not ready to meet face to face? Perhaps you only want to learn the value of your home in today’s market, that’s okay too.
Potential short sellers should always consult with their attorney and tax professional as short sale ramifications will negatively impact your credit and there could be possible tax consequences.
Home Buyers Considering a Short Sale, remember the following:
- Typically there is more deferred maintenance on a home where the owner owes more than its value. Understandingly the homeowner has often lost interest in maintaining the home and has tired of “throwing good money after bad”. Short sales are sold AS IS; neither the lender nor homeowner is motivated to make repairs.
- Be patient. Neither the seller’s real estate agent nor yours has control over the length of time the bank takes to respond to your offer.
- The initial asking price is not always a determination of market value. Often, when the listing price is ridiculously low, there will be multiple offers and the price will be overbid.
Additional information: Everything you wanted to know about short sales but were afraid to ask.
Foreclosure Alternatives for Distressed LA Homeowners