The Short Sale Option

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We’re sure hearing a lot about short sales in the media and, in fact, they’re very common here in Rochester with 10 to 15% of the homes selling as short sales.   A short sale is when the homeowner is upside down in the mortgage, owing more than what they can sell the home for so they can’t afford to sell. In this situation most sit tight.

But what happens when the homeowner gets behind in the mortgage payments by a few months? A short sale comes into play. Here’s how it typically works. The homeowner gets an offer that is less than what is due to the lender so we submit it to the bank, telling the bank we can get a certain amount for the home. Even though it’s less than what the homeowner owes, we ask the bank to release the homeowner from the lien. With the attorneys we work with we have a 99% success rate. We have a method to achieve this type of success rate. By knowing the real estate market, we systematically get as much money for the home so the homeowner isn’t giving it away, and we ensure the transaction is an arm’s length transaction, meaning the homeowner isn’t selling it to his brother or uncle.

A short sale is much less detrimental to your credit report than a foreclosure. Last year, a client did a short sale and bought a home right away. A lot of credit unions are getting more forgiving because so many homeowners are having to do short sales.

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I’d encourage you to look strongly at short sales if it fits your needs. As the market improves and banks are not worried about foreclosures, the ability to do a short sale could disappear. If you want more information, give me a call at (585) 721-3010 or (585) 279-8250.