How To Do Short Sales |
How To Sell Your Recently Purchased House With No Equity |
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| How To Sell With No Equity |
| There are many ways to lose a home in our current Shreveport Bossier City real estate market but signing away ownership in a manner that destroys credit, embarrasses the family and strips an owner of dignity is one of the hardest. |
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| For Shreveport Bossier City home owners who can no longer afford to keep mortgage payments current, or simply need to sell their existing home to lower their mortgage payments, there are alternatives to bankruptcy or foreclosure proceedings. One of those options is called a "short sale." |
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| A way to sell when you have no equity: If you purchased your home in the last two years you may find you have no equity. Doing a short sale in our local Shreveport Bossier City real estate market may be a good option for you. Especially if the home you recently purchased was newly built. |
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 We can guide you through process - call 798-1816 or click here |
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| When lenders agree to do a short sale in real estate, it means the lender is accepting less than the total amount due. Not all lenders will accept short sales or discounted payoffs, especially if it would make more financial sense to foreclose; moreover, not all sellers nor all properties qualify for short sales. |
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| If you are considering buying a short sale, there could be drawbacks. For your protection, we suggest that all borrowers: |
- Obtain legal advice from a competent real estate lawyer
- Call an accountant to discuss short sale tax ramifications
- Discuss the entire process with your Shreveport Bossier City Main OFfice Realtor® - we have guided many people through the short sale process.
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| Except for certain conditions pursuant to the Mortgage Forgiveness Debt Relief Act of 2007, be aware the I.R.S. will consider debt forgiveness as income, and there is no guarantee that a lender who accepts a short sale will not legally pursue a borrower for the difference between the amount owed and the amount paid. In some states, this amount is known as a deficiency. A lawyer can determine whether your loan qualifies for a deficiency judgment or claim. |
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| However, in our current mortgage environment Main Office Realtors® real estate agents are working closely with mortgage companies have successfully worked out solutions that have benefited many of our local Shreveport Bossier City home owners. |
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| Although all lenders have varying requirements and may demand that a borrower submit a wide array of documentation, the following steps will give you a pretty good idea of what to expect. |
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Call the Lender
You may need to make a half dozen phone calls before you find the person responsible for handling short sales. Main Office Realtors® real estate agents are experienced in this process and you can benefit from our experience. You do not want to talk to the "real estate short sale" or "work out" department, you want the supervisor's name, the name of the individual capable of making a decision. |
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Submit Letter of Authorization
Lenders typically do not want to disclose any of your personal information without written authorization to do so. If you are working with a Main Office Realtor® or other real estate agent, closing agent, title company or lawyer, you will receive better cooperation if you write a letter to the lender giving the lender permission to talk with those specific interested parties about your loan. The letter should include the following: |
- Property Address
- Loan Reference Number
- Your Name
- The Date
- Your Agent's Name & Contact Information
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| Don't get overwhelmed with the details, we're experienced. |
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Preliminary Net Sheet
This is an estimated closing statement that shows the sales price you expect to receive and all the costs of sale, unpaid loan balances, outstanding payments due and late fees, including real estate commissions, if any. Your Main OFfice Realtor® is experienced and will be able to prepare this for you, if you do not know how to calculate any of these fees. |
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Hardship Letter
The sadder, the better. This statement of facts describes how you got into this financial bind and makes a plea to the lender to accept less than full payment. Lenders are not inhumane and can understand if you lost your job, were hospitalized or a truck ran over your entire family, but lenders are not particularly empathetic to situations involving dishonesty or criminal behavior. |
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Proof of Income and Assets
It is best to be truthful and honest about your financial situation and disclose assets. Lenders will want to know if you have savings accounts, money market accounts, stocks or bonds, negotiable instruments, cash or other real estate or anything of tangible value. Lenders are not in the charity business and often require assurance that the debtor cannot pay back any of the debt that it is forgiving. |
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Copies of Bank Statements
If your bank statements reflect unaccountable deposits, large cash withdrawals or an unusual number of checks, it's probably a good idea to explain each of those line items to the lender. In addition, the lender might want you to account for each and every deposit so it can determine whether deposits will continue. But these days we've noticed that most lenders are understaffed and usually accept your documentation at face value. |
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Main Office© Exclusive Price Trend Market Analysis
Sometimes our local Shreveport and Bossier City markets decline and property values fall. If this is part of the reason that you cannot sell your home for enough to pay off the lender, this fact should be substantiated for the lender through a comparative market analysis (CMA). Your Main Office Realtor© real estate agent can prepare a unique Price Trend Analysis for you, which will show prices of similar homes: |
- Active on the market
- Pending sales
- Solds from the past six months
- Direction of the market for a number of years
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Purchase Agreement & Listing Agreement
When you and your Main Office Realtor© real estate agent, reach an agreement to sell with a prospective purchaser, the lender will want a copy of the offer, along with a copy of your listing agreement and a preliminary HUD. |
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| Now, if everything goes well, the lender will approve your short sale. As part of the negotiation, you might ask that the lender not report adverse credit to the credit reporting agencies, but realize that the lender is under no obligation to accommodate this request. Of course your Main Office Realtor© real estate agent is experienced and can help you with those negotiations. |
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| Choose The Listing Plan That's Best For You > click here |
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If you think you may be ready to explore selling your house using a
"Short Sale" >click here or call 798-1816. We'll be here when you're ready. |
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