Jan
12

Short Sales Are Lenders Choice to Stop Foreclosure

By
Donte Mazyck asked:

Short Sale your House to Stop Foreclosure Fast

Foreclosure is the last option for homeowners that give up on their house. Most homeowners that become behind on their house and feel like foreclosure is the way to go, they vacate the property and all stop communication with their lender. That is not the route to take.

Lenders would rather for you to offer them the deed back than to force a foreclosure on your house. Giving the deed back to your lender is called a deed lieu of foreclosure. They would rather receive full pay off or something close so they can recoup money without taking too much of a lost. However doing a deed in lieu of foreclosure is better than foreclosure which makes it the 2nd choice over foreclosure. A deed-inilieu will not look as bad as a foreclosure, but there is a better way.

The short sale is almost the same thing as a charge off but doesn’t look as bad on your credit as a traditional charge off. Most lenders won’t lend to a homeowner for at least 5 years if they get a deed in lieu or have to foreclose. In the case of a short sale lenders will give the homeowner a chance to own another home in 2-3 years which will be based on the way you handled your debt and your job stability.  Short sales save the time it takes to get back into the market and to be honest no one can really be in a solid position to buy a house sooner than 2 years anyway.

A short sale is when a homeowner goes to their lender personally to let their lender know that they need to sell their house in order to stop the foreclosure process that is sure to come. The term sale your house short means that your lender will accept less than what is owed on the mortgage to avoid the foreclosure process. There are a wide range of reasons why a lender would even consider to reduce the mortgage balance and it’s sort of the same as negotiating with your credit card company to reduce the balance for a full pay off. Short sales are slowly becoming the number one way to stop foreclosure. The short sale process has been around for many many years but hit the media outlets when the mortgage meltdown nearly brought economy down it’s knees. Homeowners can be a position to purchase a house in 3 years or less and can avoid the costs of foreclosure. Plus the homeowner can receive relief from their lender and waive the deficiency judgment.

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