This unfortunate situation takes place when payments can no longer be made due to difficult financial circumstances or when interest rates are so high, the property is not worth as much as the mortgage anymore. Since the price does not cover the entire amount due, this sale has to be agreed upon with the lender.
Negotiation abilities are paramount with short sales since the bank can decide foreclosure is more profitable and reject the short sale. However, foreclosures are expensive, take quite some time and especially work and paperwork and that is why some lenders prefer short sales to “share the loss” with the owner. That is why an expert real estate agent must be involved to ensure the process, which can be lengthy, takes place the best way possible and limits contingencies.
Your credit score suffers a lot less with short sales than with foreclosures, so at Great Realty we help you through the entire process until you hand over the property and help you start over, fix your credit, get your affairs in order, and hopefully, become eligible for a mortgage again soon.