Why a Short Sale is Worth Considering

If the slow economy has you pinching your last penny, you might have thought about selling your house.

See All Short Sale Listings in Fairfax County

However, because of the economic downturn, your property might be worth less than what you owe on it. In your case, a short sale might be the best solution to a tough situation.

What is a Short Sale?

A short sales is when you sell your house for less than you owe on it. It does not mean that your house gets sold quickly. In fact, short sales can take several months to close because your bank or lender has to approve the sale.

Why is my House Worth Less than I Owe on it?

The real estate market goes up and down, so it is definitely possible for your house to be worth less than what you owe on it. For example, let’s say you bought your house for $300,000, and you still owe $250,000 on your mortgage. Now let’s say that due to the economy, it is impossible to sell your house for more than $200,000.

If you sold your house, you would still owe your lender $50,000 dollars. A short sale can help you resolve your $50,000 debt.

How Does a Short Sale Work?

In a short sale, your lender agrees to absorb your property’s loss of value. This means that your lender has to approve the short sale in order for it to go through. If you want to sell your home, and you don’t think that you can sell it for what you owe on it, the first step is contacting your lender(s).

Let them know that you are considering a short sale so that you can complete any paperwork that it required.

Then, have a real estate agent to list your house. When people start making offers, you can decide which offer to accept. After you have signed a contract with a buyer, the sale is left in your lender’s hands.

They will review the sale and determine whether they will agree to the short sale or foreclose on your house. This process may take several months during which you can continue to live in your house if you choose.

Generally, the closer the offer is to your remaining balance on your loan, the more likely your lender is to agree to a short sale. Once the sale is approved, the buyer closes on the house, and you walk away owing nothing.

Why is a Short Sale a Good Idea?

Being upside down on your mortgages (a.k.a owing more than the property is worth) is a bad situation. A short sale is a way out. If you can no longer make the monthly payments on your house, a short sale can help you avoid foreclosure. If you are moving or have already moved, a short sale may be the only way to get rid of your old property.

Contact an Agent to Get Started

Visit us at www.livefairfax.com