Selling real estate can be just as much work as buying. There are so many things to worry about as you prepare your home to list on the market. Then you have to worry about the real estate agent you will hire to help you get the house sold. After that, you have to worry about who will be coming in to tour your home throughout the week. Will you hold an open house? Do you take the first reasonable offer you are presented with? Our blog was designed to assist you through the selling process a little bit easier.
A short sale is something homeowners turn to when they cannot afford their homes anymore, primarily because they owe more on them than they are worth. Offering your house for sale through a short sale is a way out of a situation like this, but it is always important to find out how this will affect you if you go through with listing your house for sale in this manner.
Get it approved through your lender
The first thing you should understand about short sales is that you cannot simply sell your house this way if you choose to. You will have to discuss your situation with your mortgage lender, and you may have to fill out paperwork to apply for the ability to do this. If your mortgage company denies your request, you will not be able to sell your home through a short sale. If they approve it, you will be able to do this, but you will not be obligated to do so.
Find out if there are restrictions
If your lender approves your request to sell your house through a short sale, you should ask if there are any restrictions. The main restriction the lender might have is that you must sell it for a certain amount. Selling a house through a short sale means that you can sell your home for an amount that is below your current balance of your mortgage, but the lender might give you a bottom amount for the deal.
For example, if you owe $200,000 on your house, your lender might allow you to sell it for $150,000 or more. In other words, you would not be able to sell it for under $150,000. Lenders set rules like this for protection.
Learn how the deficiency could affect your taxes and finances
One of the most important things to talk to your lender about is the effects the deficiency will have on you. The deficiency refers to the difference between the selling price and the amount you owe, and it is basically the amount the lender is losing on the deal. In some states, homeowners must repay this amount to the lender, and this is called a deficiency judgment. In other states, homeowners do not have to repay this.
Additionally, you should find out if you must claim the deficiency amount on your taxes as income, as this is a standard practice in most states.
If you cannot afford your home and your lender has agreed to let you sell the house through a short sale, contact a real estate agency to learn more about how to find a buyer for your house.
Share17 September 2018
