It can happen to the best of us: we fall behind on our mortgage payments due to a job loss or unexpected illness, and the bank starts foreclosure proceedings. Certainly, this is frustrating and scary, but there are options available when you’re facing home foreclosure. One such option is the short sale process.
Short Sale
A short sale refers to the process in which you sell your home for less than what is owed on your mortgage. The bank that holds your mortgage must approve this sale, as they stand to lose money because they’ll be releasing the mortgage. You must provide proof that you are facing significant hardship, and that the hardship is preventing you from paying your mortgage any longer.
In order for a short sale to go through, you must write a hardship letter to the bank explaining your circumstances, and you need to include supporting financial documentation.
Some legitimate reasons for initiating a short sale include:
- Unexpected unemployment
- Medical emergency
- Divorce
- Bankruptcy
- Death
- Job transfer out of the area
Short Sale Offer
Before the potential buyer writes his offer, he should provide a list of comparable sales; meaning sales in the area of homes similar to the home the buyer is looking to purchase on a short sale. Banks generally won’t release mortgage obligations for deeply discounted prices. The bank will want to see the sale price close to the current market value.
If you are facing home foreclosure and need assistance with a short sale or other ways to save yourself from foreclosure, contact us.
