Mortgage Short Sales – How To Avoid Disaster With One Simple Secret
The New Year was like a dam breaking with respect to foreclosures and homeowners looking for a way out.
I received more emails and phone calls yesterday than ever before. A lot of folks I spoke to yesterday have the following issues:
1. Negative amortization loans, where the longer they pay, the more they owe
2. Multiple loans — a first mortgage and a second. Some people pay the first mortgage payment using the second mortgage equity line of credit
3. Owe more than the house is worth
4. Can’t afford to continue making huge mortgage payments
Everyone wants to try to save their good credit. Or improve their credit if it already is suffering.
And many people want to stay in their house. But the truth is this:
When you are upside down or in a negative amortization situation, have multiple loans, owe more than your house is worth and can’t afford crippling mortgage payments, the only thing to do is to get out from under.
That means you have to move.
First, if you are thinking of doing a sale-leaseback or something that lets you sell the house and yet stay in there, forget it. The lender won’t cooperate with that and you can’t do that.
Second, think short sale. Here’s how to conduct a short sale.
You have to parts to the short sale. First you have to convince your lender to accept the short sale. When you do a short sale, the lender is getting all the proceeds from the buyer after paying things like real estate commissions and closing costs. So the lender wants you to get the highest amount you can for your house. And if your buyer is paying too little, the lender may not agree to the short sale.
The lender may not agree anyway. There are tricks and techniques — always staying completely honest — that will raise the chances of getting the lender to say yes and having a successful short sale.
Get a low broker’s price opinion, or BPO. The lower the better. The lender looks at a BPO in order to determine if your short sale price is reasonable. The lender may be okay with a buyer paying 85% of market value, but not 80% or 75% of market value. The broker’s price opinion is crucial to convincing the lender to say yes once you get an offer.
But besides lender approval, the other side people forget is that they have to actually sell their house. Selling a house today can be tough when the street you are on is littered with for-sale signs by short sales and bank owned properties.
If you list with a real estate broker, your house typically goes on the multiple listing service, or MLS. It can just sit there. Buyers are very shy about making offers these days and I speak to people every day who end up losing their homes in foreclosure. The short sale is okay with their lender, but the sellers fail to sell their house. So the whole effort is wasted, they end up with a foreclosure on their credit record, and the lender gets an unwanted house back.
So it is essential you realize that you must sell the house and you can’t do this the way everyone else is doing it.
The formula I use to sell houses quickly is the nine day house sale method. Later this month purchasers of Mortgage Relief Formula will get to participate in a conference call with an expert who has done over 60 of these sales, many of them short sales. The entire nine day house sale sells your house in less than two weeks for top dollar, with no fixup.
If you are a real estate agent you owe it to yourself to offer the nine day house sale to your clients. And if you are doing a short sale for your own home, you owe it to yourself to take a look at Mortgage Relief Formula, get your short sale approved, and sell your house so you are in settlement weeks from now.
You can still do this short sale even if your trustee sale is next week.