Short sale your home and receive no money at closing, is that fair?

Selling a home is stressful for all sellers. It is especially stressful for someone who is facing financial difficulties and needs to short sale their home.  They have to provide their lenders with countless documents to help their lenders to realize that they cannot afford their home and must sell.

Luckily, with patience and endurance, we are able to obtain a short sale approval from the lender of which allows the seller to move on from a very tough financial situation. At the time of closing, the seller walks away without receiving any proceeds for the sale of their home. Meanwhile, the real estate agents involved, attorneys, and others receive some form of compensation. Is this fair?

Yes, it is fair as the sellers receive the following benefits:

1)   You minimize the impact to your credit.

If someone is going through a short sale, they are most likely behind on payments and accordingly have experience a decline in their credit scores. Upon a successful short sale of their home, many of my clients are able to slowly but surely rebuild their credit over time. Usually it takes around 2 years if they are paying their bills on time and doing the right things.  However, the alternative, a foreclosure sale, will have a long term negative impact on their credit scores sometimes lasting up to 7 years. 

2)   You Avoid a deficiency judgment

Normally, with most shorts sales, the lender will accept a short sale and will waive deficiency judgment, meaning the lender will not come after the seller for the loss taken by the lender. However, with a foreclosure, the lender will in most cases come after the seller for a deficiency judgment of which can be quite damaging.

3)   Have you ever had a foreclosure?

Many of times, when applying for a loan, you will find that whoever is lending you money will ask you the following question: “Have you ever had a foreclosure?” There is a reason why they ask you this question.  If you could lend money to someone who had a foreclosure in the past or to someone who might have had credit damage in the past but avoided foreclosure because they cooperated with their lender, which would you choose?  When you short sale your home you are cooperating with your lender and that is looked upon as someone who took responsibility and made the best of a tough situation.

 When you decide to short sale your home you are receiving the above benefits and many more benefits. In addition, some lenders are no allowing sellers to receive proceeds at the time of closing. I recently closed a short sale in which a client received $3,000 at the time of sale.

 If you are considering a short sale, please call Custom Realty Solutions, LLC at 781-591-0799 or please fill out the form located at http://sellfastmass.com/short_sale_my_home/.