Is a Short Sale the Right Choice?
Since we live in tough economic times, we face a decline in home values for more than ten years. Because of this, many homeowners who owe more than their home is worth, find themselves trapped in the current market. They need to sell their home fast, if not they will face foreclosure and heavily impact their credit history. What should a homeowner do in such situation? The most viable option you can select is short selling your house. Maryland Short Sale Company is one of the top experts in shorts sales in MD and they will gladly come to your aid and guide you through the process.
What is a Short Sale?
This type of transaction is a sale in which your home is sold for less than its worth. When a borrower doesn’t have enough money to cover his existing mortgage payments, he can either face foreclosure or sell his home short. Your lender doesn’t have any obligations to accept a shorted payoff, however, most of them will. They don’t have any benefits of keeping you around as a non-paying buyer. However, after selling your house, even if it’s for less than you owe, they can sell your home again to another buyer. This way, the house that previously caused them problem will provide them a monthly steady source of income once again.
During the process of short sale, your role is nothing more than that of a contingency. Your role can vary depending on the whether your state is a title theory state or lien theory state. Even you didn’t pay your mortgage in time until you sell your home, it is still yours. Therefore, you are the only one who can accept, reject or propose a counter offer once an offer is received from a buyer. When you accept an offer, at the same time, your lender must agree to accept the net proceeds of the sale as full payments of the amounts of money that you owe. In a case of multiple offers, you may get confused. However, your agent is here to come to your assistance. Not all offers must be presented to the lender; instead, all offers must be presented to you, the seller. The role of your realtor is to obtain the best possible offer for you and give the transaction the chance of actually closing.
Odds of a Successful Closing
Most transactions are successful if you have a realtor and a real estate attorney by your side. Nowadays it is better for banks to accept a short sale because it makes more profit than going through a foreclosure process, taking the house back and marketing it as an REO (Real Estate Owned). In Maryland, lenders may foreclose on a mortgage using either the judicial, non-judicial foreclosure process or assent to a decree. Judicial foreclosures are rather complicated and they need about one year or more to complete. In certain states, the process can take more than three years. While the process drags along, the bank receives nothing. Therefore, they will have a lot more benefits if they accept your offer. Once deterioration of the property and additional carrying costs are added, the benefits to the bank of accepting a short sale become obvious. As the homeowner, the bank is also looking for best way to cut their losses.