Why A Bank Short Sale Versus Letting Your Home Go To Foreclosure Or A Deed In Lieu? Finally Clear Answers That Can Stop A Homeowner's Head From Spinning!
Why Defaulted Homeowners Should Consider Short Selling Now
If you're like many other homeowner's, you've asked yourself why should I consider a bank short sale of my home when no matter how you look at it, I am losing my home anyway.
What's the difference? I might as well just stay here and save my money until I get kicked out!
As much as that seems attractive, a homeowner should know the ramifications they will need to be aware of and suffer for afterwards.
Especially now considering the current market conditions I would advise looking ahead and preparing for where you would like to be and what you would like to achieve.
Foreclosures are expected to peek through the first quarter of 2012 in which those homes will need to be marketed and sold. Until most of them have been absorbed or bought up, we expect to see prices continue to fall.
Simple economics of supply and demand. An over supply of inventory will bring the prices down. So how does this effect you as a homeowner in default, you ask?
By short selling today, you could still catch the bottom of the wave and be prepared to buy again in just two short years taking advantage of home prices while still at a low.
A foreclosure or deed in lieu could result in being penalized for up to seven years while watching great opportunities pass you by! Here's why:
(per the October, 2010 issue of California Real Estate publication the official magazine of the California Association of Realtors):
Lenders naturally have strict guidelines for borrowers who've been through a short sale or foreclosure or have deliberately walked away from a mortgage. But even these former homeowners can apply for a new loan after a waiting period of two to seven years, depending on the buyer's circumstances and reestablished credit history.
"The two year wait applies to buyers who completed a bank short sale and want to obtain a loan insured by the Federal Housing Administration (FHA), while the seven year wait applies to buyers who deliberately defaulted on a mortgage despite the ability to make the payments and want to get a loan that can be sold to Fannie Mae."
If you are one of many homeowners facing this situation, it's important to take a step back and think long and hard before making a critical decision. Your future is literally in your hands.
For more information or to start your short sale process, click the link below. We are here to help!