If you’re a homeowner, a strategic Short Sale is the option in which you’re able to continue making your mortgage payments, but you’re upside-down with your home loan.
Usually, in a Short Sale, you are behind on your mortgage payments, but in the case of a strategic Short Sale, it’s possible for you to begin the process even if you are current on your payments. However, because your home values have fallen and you still owe more than the property is worth, you’re seeking a strategic Short Sale because you wish to be free of the negative investment.
Is a Strategic Short Sale Better than a Strategic Default?
There are many differences between a strategic short sale and a strategic default.
- Although both a short sale and default will negatively impact your credit rating, the short sale will not affect it as badly as a foreclosure.
- Opting for a short sale will allow you to qualify for a new mortgage in two years instead of seven. But keep in mind, Fannie Mae released a new lending guideline that treats homeowners who strategically defaulting by enforcing the same mortgage qualification rules.
- In Short Sales, many banks, because are now willing to accept payment of a loan at the property’s current market value and consider it “payment in full.” This is preferable to them over the time and costs involved in foreclosing on the property.
Is a Strategic Short Sale Right for You?
Strategic Short Sales may not be the right choice for everyone. If you’re able to afford your mortgage, and can continue to do so over time, pushing for a Short Sale because of slight negative values in your area may not be worth it in the end. Especially if you are happy in your current home and location. It might be best to continue making mortgage payments and wait for the market to stabilize.
But if you’ve experienced a significant drop in values, and the vacant homes surrounding your property are continuing to drive down your valuations, a strategic Short Sale might be your best option.
What is the Process for Moving Forward with a Strategic Short Sale?
Without the help of a Short Sale Specialist, the Short Sale process can be long and confusing.
A Strategic Short Sale has four main steps you must complete:
- Hire a Short Sale Real Estate agent
- List your home to interest qualified buyers
- Complete the lender paperwork in the required period of time
- Negotiate the short sale with the lender and have it approved
If you want to ensure your strategic Short Sale has the best chance of success, it’s important that you work with a real estate agent that has extensive experience in the process. If you try to get the short sale approved by yourself, without any guidance, and you are not successful, your lender might overlook your second attempt, whether you have hired a professional or not.
Remember also that without help, a Short Sale may take longer to complete than a regular sale, since lenders spend more time on figuring out the best way to manage the offer paperwork and work through the approval process.
What Do You Gain from a Strategic Short Sale?
Unlike a Strategic Default, when you choose to pursue a strategic Short Sale, you can save time, money and your credit rating, and typically be able to apply for a new mortgage to buy a home in a shorter period of time.
If you need more information about strategic Short Sales in Long Beach, visit http://markshandrow.com/free-book/to download my book: Should I Short Sale My Home? The Homeowner’s Guide to Surviving the Worst Real Estate Market in History.
For questions about the book, feel free to email me at mark@shandrowgroup.com or call me at 562-364-9505.
Sincerely,
Mark Shandrow
Real Estate Broker
office 562-364-9505 ext 100
mark@shandrowgroup.com
Shandrow Group
3970 Atlantic Ave., 210
Long Beach, CA 90807
follow my story at http://markshandrow.com
{ 0 comments }
