When headed toward foreclosure, it can be one of the most difficult times in life. Accept it early on and get assistance as quickly as possible.  Here are answers to some frequently asked questions:

How do people get into this situation?  Recently, it has come about because variable interest rates have gone up and property values have gone down, leaving no room for refinancing into a better loan.  Homeowners who bought at the peak and who are now facing divorce, job transfers, or job loss also find themselves needing a short sale. It all boils down to owing more than a home is worth and not being able to afford the payments. 
 

Can anyone get a short sale?  No. There must be a proven financial need.  Paying less than is owed must be negotiated and agreed upon by the lender.  Many lenders will not even discuss a short sale unless there is an accepted purchase contract in hand from a qualified buyer.  And then, they may reject it. There needs to be a hardship.


What is the benefit of a short sale instead of a foreclosure? The best candidate for a short sale is one who has managed to make all loan payments and has a credit score worth preserving.  If loan payments are not current and the person's credit score is extremely low, there may be no benefit to a short sale.  Letting the property go to foreclosure may make more sense.  This is why it is a good to face reality quickly when you see you cannot make payments much longer. Don't wait for a miracle. 
   

How Do I Get the Process Started?  The first step is to contact my direct line and set up an appointment to meet at your home. All persons on title need to be present. Have a copy of your W-2 form or a letter of termination from your last employer.  Have copies of your last two tax returns and any other documentation outlining your income and debt obligations.  I will provide you with a letter template that gives me permission to talk with your lender(s). 
 

What Can You Do to Help Me?  We will discuss your situation and come up with an individualized plan.  If you want to attempt to stay in your home, that will be Plan A, but we will also come up with Plan B, Plan C, etc.  Once I have the documentation I need to negotiate on your behalf, we will list your home for its realistic current fair market value to generate offers as quickly as possible. I will begin negotiations with the lender(s).

 If I list it as a Short Sale, should I care about my home's condition?  Yes. It may be unpleasant to care for a home when you are loosing your equity on the sale, but don’t make the mistake of "trashing" the home.  DO NOT invest in expensive repairs.  Make your home as presentable and "showable" as possible.  It should be clean, neat, and if you have time to put a fresh coat of neutral paint on the walls, all the better.  Attend to the yard.  Anything free or cheap you can do to make your home more marketable will result in a higher price, which will satisfy the lender that a short sale is worth their consideration. 
 

 Will everyone know my home is up for a Short Sale?  This information is mandatory in the MLS listing.  Those who are shopping for homes with a Realtor in your area will know.  Usually, most other people will not know, unless you or your friends tell them. 
 

What if our lender rejects the short payoff?  This is one reason the buyer’s agent must be advised it is a short sale. The lender is required to accept the offer on a short sale. Being listed as a short sale, the buyer's agent will know this and advise his or her client of the situation.  If the lender does not accept the offer, and a suitable counter offer cannot be negotiated, then we will attempt to get a second offer.

How long will it take for the house to sell?  It is impossible to say.  By pricing the home appropriately and having it in its best showing condition, homes are averaging 30 to 90 days on the market.

Do all Realtors do Short Sales?  No. Most choose not to do them because they are a lot of hard work, they require additional skill and training, and they do not always result in earning money. 
 

How can you help me to stay in my home?  Honestly, it may not be possible.  However, after you list for the short sale, I will work to get you qualified for a variety of programs that allow you to stay in your home. These may be offered to you as an option.

 
Are there any financial or credit repercussions of doing a short sale?  It is up to the lender whether to “knick” your credit after a short sale, but typically they do not. If you go all the way to foreclosure, it is a certainty.  I advise everyone who inquires about a short sale to get advice from their tax professional regarding any possible tax implications.  I am not a qualified tax consultant. 

 
My cousin Bertha has a real estate license.  She hasn’t ever sold a home, but couldn’t she do this for me?  Get a full-time professional to assist you. This is not an area of real estate that is well-suited to inexperienced part-timers.  I would be happy to provide you with a referral to another qualified specialist if you prefer to use someone other than me.  I will help you in any way I can.

Does it cost anything for your services? As with most real estate sales, as the seller's agent, my commission is paid at the close of escrow.  It is based on the local industry standard and must be acceptable to the lender.
 

How can we set up an appointment?  You can either call me on my direct line at (949) 525-1575 or you can email me, providing your name, address, telephone number and the best time to contact you.  Before coming to meet with you, I will prepare a comparative marketing analysis of your home's value to assist in pricing it.  Because time is of the essence in a short sale, we should meet soon after you contact me.

May I call you if I have questions?  Yes, you are welcome to call me. To answer very specific questions, I will need to see your home and copies of the financial documents which you will provide at our first meeting.  Feel free to call if you have any general questions about a short sale.