Successfully sell your home in a short sale with these tips.
If you’re facing mortgage woes, then a short sale may be the perfect solution. A short sale occurs when a homeowner in poor financial shape sells a home for less than the amount due on the mortgage, with all the proceeds going to the lender. They offer an appealing alternative to foreclosures, but that doesn’t mean that it’s an easier process to endure. If you have time on your side, then follow these tips for a successful short sale.
Tips for Selling a Short Sale
- Choose a short sales expert. Interview agents and ask how many short sales they’ve closed. Reach out to former clients and ask how their experience was. A short sale can take months to close. You want to select an agent that will give you their A-game from beginning to end.
- Understand the consequences. Short sales don’t fix everything and they’re not magic. It’s crucial for borrowers to understand whether the lender agrees to waive the deficiency, or the balance that will be left on the loan after the sale. You don’t want to be surprised by a collection letter for the difference years after the sale.
- Negotiate. Believe it or not, you can negotiate. Most lenders won’t voluntarily release you of liability for the loan’s remaining balance, but you can negotiate a waiver. “I’ve never had a lender refuse to negotiate a settlement,” one real estate agent explained.
- Hire an attorney. issues range from potential tax implications to protecting other assets the borrower may own. Real estate agents who are experienced in short sales can coordinate the transaction, but remember they’re not lawyers.
- Stick to those HOA payments. Even when considering a short sale, don’t stop paying your homeowners association dues. Don’t rely on the buyer to pay delinquent dues at closing; it may ruin a prospective deal.
Selling a short sale is a lot of hard work, but it can be done by following these tips. If you’re on the other end of the deal and looking to buy a short sale, read our advice here.
The Minnesota Association of REALTORS® is the largest professional trade association in the state with more than 17,000 members who are active in all aspects of the real estate industry.