What is a short sale and how does it benefit you here in Dallas?
If you’re asking that question for yourself… then you’ve asked a great question!
In this article we’ll dive into that question so you as a Dallas TX homeowner will know what your options are during foreclosure or if your home mortgage is under water.
What is a Short Sale and How Does it Benefit You?
A short sale can be a smart way to mitigate foreclosure on a home (here’s a great definition of what a foreclosure is in case you’re not sure). Although short sales can be difficult to attain in today’s market, they often prove to be a simpler way to resolve leftover debt from a loan.
Short sales were really common in the market a couple years back when the flood of foreclosures hit the Dallas market… but as foreclosures have slowed down and home values have climbed back up quite a bit… lenders are a little less likely to offer a short sale as an option as they used to be (but they are still doing a lot of them!).
Here are a few reasons you may want to consider short sale on your Dallas home
You Avoid Foreclosure and The Harmful Effects of It
The best benefit of a short sale is that you avoid a foreclosure on your home. Your mortgage lender accepts less than what is owed on your mortgage, leaving you without the amount of debt that you cannot afford.
Foreclosure can lead to all kinds of financial problems, starting with the inability to obtain a new loan for a home because a foreclosure stays on your credit record usually for up to 7 years.
Even renting will become more difficult as your credit score is still considered when you’re applying for a rental. Often, renters still have to disclose a foreclosure on rental applications. Foreclosures can also last a long time on your credit (up to 7 years as mentioned above), making it years before someone is able to qualify again for a new mortgage.
Credit Worries
With a foreclosure, there are all kinds of ramifications to face regarding your credit. Buying a car and renting a house may be impossible through the normal bank loan routes.
If you work with money at your job, it’s possible that you could even face termination if your employer thinks that a foreclosure on your home could directly affect your handling of finances or money in your day to day responsibilities at work (most employers won’t , but it has been done before).
A short sale relieves the debt that is leftover from what is owed on the mortgage, letting both the bank and the seller move on. A short sale is also easier on your credit score, which can allow a homeowner the ability to recover faster in the long run. Your credit report will only show a pre-foreclosure status, which reduces your credit rating minimally compared to a foreclosure.
Buying a New House
A foreclosure can last for a long time, making it impossible to purchase a mortgage again for up to 7 years.
Short sales offer a little more flexibility for the seller, allowing new home applications only 2 years after the filing depending on the bank. It also makes a mortgage lender more likely to approve your loan if you don’t go through full foreclosure, getting you back into a home faster.
Again, this all depends on the actual bank / lender you’re working with… so if they’re giving you a hard time a year or two after a short sale… shop around and find another bank to work with.
Usually No Fees Involved
One potential benefit of the short sale is there are usually no fees associated with the process from the bank. The banks just want to get the note off of their books… and if it can be proven that your house is “under water” (you owe more than your house is worth)… and you’re at the risk of walking away from the house… the bank may rather work out a short sale instead of going through a costly foreclosure. Banks aren’t in the business of owning properties, so in many cases, they’d rather work with you so that you can sell your home instead of having to go through the process of taking the home from you and then selling it.
With a full foreclosure, your mortgage lender may tack on extra fees that only make the process worse.
Some real estate consultants may charge a fee for helping facilitate the foreclosure with your bank… so check with them before you enlist a real estate agent or firm in helping you with this.
Our company, Jamie Buys Houses may be able to guide you in the right direction on how to give yourself the best shot at a bank approving a short sale with your Dallas area house… so connect with us by calling 972-318-9500 or shoot us over an email through our contact page here.
Getting a Short Sale – What You May Need To Provide
You will have to provide the bank with proof of being unable to pay your mortgage payments. This can be difficult and is best resolved by finding a good real estate attorney in your area that has experience dealing in this type of law.
If you don’t know who to contact or where to turn to see if a short sale may be a good option for you… get a hold of us.
We won’t charge a thing to discuss your situation with you and let you know your options.
And we can even give you guidance and pointers at absolutely no cost or obligation.
Sometimes we’re actually able to do the work for you or even buy the house to help get you out from under that mortgage… so that may be a viable option for you.
We buy Dallas houses, and we work with home sellers like yourself who are having troubles getting out of your house the traditional way… or who can’t (or don’t want to) go the usual route of listing with an agent.
Get a hold of us anytime to discuss your situation. We’re here for you!
Or, if you want to see what we can offer on your house… click the link below and fill out the form on the next page. We’ll make a no-obligation cash offer to you within 24 hours. At least that way you’ll know whether that is an option for you or not.