WHAT IS A SHORT SALE?

You've heard the term mentioned a lot, but what exactly does it mean?

A short sale is the sale of a property, with the authorization of the creditors, for less than what is owed on it. Short sales are done all the time. Whether it is the forgiveness of debt owed by a corporation or an individual, it simply means that someone is willing to settle for less than what they originally anticipated. It's part of business. All lenders know that they will not win all the time. Risk and loss of capital is an anticipated cost in the lending industry. Changing economic conditions, conflicts, and Mother Nature are among some of the many causes of unforeseen situations that turn good lending contracts into bad. In the context of foreclosure on secured assets, a short sale occurs when debtors agree to settle their liens for a known amount of money as opposed to taking a chance at auction. Auction prices are often unpredictable and usually greatly discounted. Many lenders are willing to mitigate further risk of loss by making deals before auction. Bad debt is sold by lenders all the time. For instance, there is a huge market for unsecured credit card debt that is sold for pennies on the dollar to collection agencies. Lenders are more than happy to discuss resolution of aged debt. Their business is to lend capital, not dispose of foreclosed assets. But once a property goes into pre-forclosure, often time has begun to run out.

HOW I HELP YOU...

Bad feelings are often associated with respect to people making money over the misfortune of others. There are countless scams in the finance industry that prey on vulnerable people. Contrary to what many think, a valuable service can be provided that benefits both the property owner and lenders.  Here's how:

In a short sale, the lender has agreed to settle the matter without further claims, and the property owner clears their obligations without the lingering negative effects of a foreclosure and subsequent garnishment of additional monies that auction did not bring. Lenders would rather short sell then foreclose on a property.  By short selling, they lessen the loss in the long run. 

In today's real estate market, it is critical to understand properties in foreclosure.  Many real estate brokers do not want to work with or do not understand short sale listings.  I have surrounded myself with professionals that deal with the short-sale process every day and work closely with me to make sure that the process moves forward as quickly as possible. If you feel you need to short sell your property or might be close to foreclosure, I encourage you to speak with me. My colleagues and I will sit down with you and put together a plan that makes sense for you and your family.