The Short Sale
Sometimes the owner of a property is no longer able to pay the mortgage or deed of trust. When this happens, foreclosure often follows -or worse: bankruptcy. But there is an alternative, the short sale.
Short sale is usually the last step taken by the bank to recover losses from a defaulted mortgagor. When lenders agree to a short sale, it means the lender agrees to accept less than the total amount due. They are willing to forgive a certain amount of debt or deficiency. However, not all lenders will accept a short sale or discounted payoffs, especially if it would make more financial sense to foreclose.
That's right, the lender agrees to accept payment that's considerably less than the total amount that's due. Not every bank or lender will accept a short sale -of course it would make much more financial sense to pursue foreclosure and just take the collateral.
The amount of time for a short sale to get approved is difficult to guess. In other words, the short sale process is long and tedious. The lenders in short sales business usually say that it takes 21 days time for the approval to come through.
The tedious process of securing a short sale is sure to take a very, very long time. 21 days is the usual answer, should you ask the lender. But that's just a minimum, some cases may actually take twice that time to get approved.
Short Sale Strategy Overview
The full process of a short sale will include a contract, an Authorization to Release Information and the addendum. A warranty deed is a tool used in the process. Let's examine the process now, starting with the contract.
The process is quite simple to understand, it starts with the contract, then the authorization to release, and lastly the addendum. The warranty deed is also part of this whole process. What are really important to grasp in the process is the first two documents:
The Addendum
Addendum: Perhaps the most important document in the process, the addendum contains the basic and vital information regarding the property and the transaction:
Origination of the contract
Date
Names of the parties involved
Address
Tip: It's advised to list both the legal address and the simple address in the addendum -for the purposes of clarity and transparency.
Any investor, who wants to make money in the foreclosure market, should always consider that a short sale could still bring him a bargain property. - 23222
Short sale is usually the last step taken by the bank to recover losses from a defaulted mortgagor. When lenders agree to a short sale, it means the lender agrees to accept less than the total amount due. They are willing to forgive a certain amount of debt or deficiency. However, not all lenders will accept a short sale or discounted payoffs, especially if it would make more financial sense to foreclose.
That's right, the lender agrees to accept payment that's considerably less than the total amount that's due. Not every bank or lender will accept a short sale -of course it would make much more financial sense to pursue foreclosure and just take the collateral.
The amount of time for a short sale to get approved is difficult to guess. In other words, the short sale process is long and tedious. The lenders in short sales business usually say that it takes 21 days time for the approval to come through.
The tedious process of securing a short sale is sure to take a very, very long time. 21 days is the usual answer, should you ask the lender. But that's just a minimum, some cases may actually take twice that time to get approved.
Short Sale Strategy Overview
The full process of a short sale will include a contract, an Authorization to Release Information and the addendum. A warranty deed is a tool used in the process. Let's examine the process now, starting with the contract.
The process is quite simple to understand, it starts with the contract, then the authorization to release, and lastly the addendum. The warranty deed is also part of this whole process. What are really important to grasp in the process is the first two documents:
The Addendum
Addendum: Perhaps the most important document in the process, the addendum contains the basic and vital information regarding the property and the transaction:
Origination of the contract
Date
Names of the parties involved
Address
Tip: It's advised to list both the legal address and the simple address in the addendum -for the purposes of clarity and transparency.
Any investor, who wants to make money in the foreclosure market, should always consider that a short sale could still bring him a bargain property. - 23222
About the Author:
Know about short sale an alternatives to bankruptcy or foreclosure only at Don Burnham's website http://www.weknowthewayback.com. Visit today to know all about short sale!
posted by X - Men @ 1:00 AM
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