Foreclose Online
A Short Sale Can Stop Home Foreclosure & Save Your Credit
Nothing is as detrimental to your credit rating as late mortgage payments and
foreclosures. If you have fallen behind on your mortgage payments and are facing
home foreclosure, you should consider using a short sale to sell your home now
and avoid foreclosure.
One of the most common questions that homeowners ask is, "can I still sell my
home if I am in foreclosure?" A Short Sale is simply selling your property for
less than what is owed with the permission of your mortgage lender. It is not as
complicated as many foreclosure advice experts make it sound, and is one of the
best forms of foreclosure help available. There are three steps to closing a
short sale: short sale pre-qualification, marketing the property, and closing
the short sale.
The first step, short sale pre-qualification, is when you contact your lender
and explain that your financial situation has changed and you wish to avoid
foreclosure by selling your home. Most lenders have a short sale application
that can be faxed or emailed. The application will tell you what documents you
will need to gather and submit to your lender in order for them to determine if
a short sale is an option. Common documents include paycheck stubs, tax returns,
hardship letter, and bank statements. These items show your lender that you are
not in a position to repay the loan.
Once your file has been pre-qualified for a short sale, you will market the
property to find a qualified buyer. This means hiring a realtor and, if you can
afford it, advertising your property in your local newspaper or other real
estate publications. Remember, you are not trying to profit from the sale or
cover what is owed to your lender. You are simply trying to stop home
foreclosure and avoid have a foreclosure on your credit history by helping your
lender recover as much of the money they loaned you as possible. It is also
important to remember that the foreclosure process can be quite lengthy in some
states, so don't give up using a short sale to avoid foreclosure just because
you do not find a buyer immediately.
Lastly, once you have found a qualified buyer, you will submit your purchase
contract and the buyer's credentials (pre-approval letter or proof of funds to
close) to your lender. If your lender accepts the offer, then the deal is sent
to a title company who will facilitate the closing of escrow. It is also
important to order any city of point of sale inspections or other inspections as
to avoid delaying your buyer from closing on time.
Once you have completed these steps, you will have stopped home foreclosure and
your credit rating will be much better, in most cases, than if you had simply
done nothing and lost your home through the foreclosure process. A short sale is
a great option to anyone trying to avoid foreclosure.