The Top Ten Short Sale Questions
Answered
Q. I can’t make my house payments, but I do
have an ability to pay back all or part of the negative equity. Also, I want to
preserve my credit score…is a short sale right for me?
A. Probably not. In cases where the seller
can pay back all or part of the negative equity (usually to the 2nd lien holder)
it makes sense for them to work out a repayment plan. The lender will then
release the lien and allow the home to close.
Q. If I pay mortgage insurance but default
on my loan, why wouldn't that cover the deficiency amount?
A. The mortgage insurance is not there for
your protection, it only protects your lender.
Q. Do I have to have my home approved by the
lender prior to offering it for sale as a short sale?
A. No. Technically speaking there is no such
thing as being short sale approved. The actual approval only happens with an
accepted offer from a qualified buyer.
Q. I just missed a payment and I know I will
miss more. How long does the foreclosure process take and is there time to do a
short sale?
A. The foreclosure process takes differing
times depending on your state. In the Midwest a foreclosure can take over a
year. In California it’s taking 6+ months. Generally speaking a well-priced
short sale being processed by an educated short sale listing agent will sell and
close in less than 120 days.
Q. Will I still have to pay property taxes
if I do a short sale?
A. Property taxes will always have to be
paid as part of any accepted short sale. Whether it’s you or the lender depends
on their policies and the specific agreement you reach while negotiating the
short