There are a number of reasons why you may be looking to sell your home fast. Your home may need repairs you can’t afford. You may have inherited a house you simply can’t afford to maintain. Or you may have a job opportunity in another part of the country and you need to sell your home here in order to buy a house there. However, if you owe more on your home than what it is worth, you may be wondering how you can get out from underneath it. In such a case, a short sale could make sense for you. Getting answers to the questions you have about short sales will help you decide if a short sale is ideal for you.
Who Can Short Sell a Home?
If you owe the bank more than the home is currently worth and you do not have the money to make up the difference between what is owed and the amount for which you can sell the house, you may be able to short sale the home. A good real estate agent will be able to advise you what criteria your lending agency will look for when deciding whether or not to accept your short sale proposal. Typically, banks and lending agencies are amenable to short sales, as this kind of sale at least prevents them from having to foreclose on the home and then find another buyer. As long as you can show you don’t have the assets to pay the difference between the sale price and the amount you owe, and you find a buyer who is willing to pay a reasonable amount based on comps in the area, the bank will most likely agree to the short sale.
Do I Have to Continue to Make Payments While I’m in the Process of a Short Sale?
If you can afford to make your house payments, you should continue to do so. Failing to make your house payments will greatly impact your credit and could trigger the foreclosure process. If you simply can’t afford the payments, call your lending agency and let them know you are trying to short sale the house. Provide them proof, such as the listing, and they may be able to delay foreclosure proceedings to help you sell the home. There are also many companies providing “cash for my house” services that will buy a home quickly.
What Impact Will a Short Sale Have on My Credit?
Many people worry that a short sale will damage their credit or they won’t be able to buy another home for many years. According to the credit reporting company Experian, “the term “short sale” does not appear in a credit report. When you negotiate a short sale, the lender is agreeing to accept less than the full amount owed on the mortgage, and will likely report the account as settled for less than the full balance.” This mark will negatively affect your credit. However, if you were delinquent on payments leading up to the short sale, the history of late payments will remain for seven years, even after the account is settled and closed. And when your mortgage loan shows a history of delinquency in addition to the settled status, it could have an even greater negative effect on your credit scores.
The impact a short sale will have on your credit specifically is based on many factors. Short sales are fairly common these days. It’s important to realize how the short sell process can help you get out from under your debt. Once the mortgage debt is resolved with your mortgage company, you can begin rehabilitating your creditworthiness over time by paying all of your other debts as agreed. With that in mind, many lenders are willing to overlook a short sale if you are buying a home with lower payments than the one you owned previously.
Making the decision to short sale your home is a tough one. However, if you can’t afford the payments and you owe more on your home than it’s worth, a short sale may be the best way to fix the situation. In other cases when you need to sell fast and are asking “where can I get cash for my house?” a call to Express Homebuyers at (877) 804-5252 can provide you with answers.