Short sales are sales where the homeowners lender accepts a payoff “short” of the actual amount to pay off the first mortgage, are the most difficult of residential real estate transactions to close. Nationally approximately 89% of all attempted short sales fail to close. The reasons for this are many, including the average amount of time taking anywhere between 4-12 months to close, buyers changing their minds because they found a comparable home cheaper, interest rate increases which cause the buyer not to qualify for financing, and the seller deciding to let the home go to foreclosure or declaring bankruptcy because they are not allowed any compensation on the closing of a short sale.
The Federal Government understands what the problems are and have instituted some measures to hopefully facilitate the closing of short sales.
According to a Treasury spokesperson the government will soon offer a $2500.00 subsidy ($1000.00 to the servicer and $1500.00 to the seller) to facilitate more short sale closings and reduce the inventory of homes nationwide. It is hoped that the fees will provide incentive for the servicer to complete the transaction, and to give the homeowner who would normally receive not a penny at the closing, enough money to move somewhere else and leave the home in good condition.
This would also be less of a loss to the servicer than having the home go to foreclosure, which unfortunately occurs roughly 80% of the time a short sale is attempted.
Anyone considering a short sale needs to meet with an attorney who specializes in short sales prior to listing their home because of certain legal penalties that can be incurred associated with the mortgage they obtained to purchase their home. Many of our agents work with Broker’s Title in Maitland, Florida near Orlando that requests a list of documents from seller to be brought to the initial meeting with an attorney. After the attorney reviews the documents and interviews the homeowner, the homeowner decides whether to attempt a short sale, let the property go to foreclosure or seek bankruptcy protection.
Any agent you select to do the short sale should have a minimum of ten successful short sale closings. This is a niche transaction that is difficult and often unsuccessful real estate transaction and requires a Realtor experienced in short sales, not a rookie or even a veteran Realtor who has not done any short sales.There is no charge for the one hour consultation, and the only fee charged for the loan mitigation is $1500.00 at the closing if the short sale is successful.
If you are interested in searching for homes in the Central Florida market, please click here www.ExitRealtyOrlando.com
Tags: Banks, Finance, First time home buyer, foreclosures, orlando
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