You don’t have to lose your home to foreclosure. If you are a home owner facing foreclosure or you cannot negotiate with your lender to work out a repayment plan or loan modification, a short sale can be a viable option.
Many consider a short sale better in the long run for the homeowner because it helps them avoid foreclosure. A foreclosure will damage a person’s credit score, make it much harder for them to buy another home in the future, and it will stay on their credit report for at least 10 years as it is a "court action" similar to bankruptcy. A foreclosure in fact, can do even more damage to your credit report than bankruptcy!
If you are serious or "just curious" about selling your home as a short sale, our site is available to give you the knowledge and needed information to make an educated decision. Too many times we hear folks say they had "no clue" where to go or what to do and then sadly lose their home to foreclosure! Our site was created to help educate the homeowner and make them feel assured they are making the right decision. We are here to help you close this chapter of your life so you can be free to move on to the next.
Many attorneys nowadays will tell a homeowner to "Just walk-away” or “Foreclose, then file for bankruptcy.” There is no "One Size Fits All" approach for a solution to an individualized problem! There is usually a better way to handle this situation, especially if you have little debt other than your home mortgage.
The short sale process will require some legal counsel along the way, but it is minimal in most cases. There are many real estate attorneys who are familiar with the closing requirements of a short sale in Illinois. We also recommend that the homeowner consult a tax professional, for any questions they have concerning tax consequences. There are many new laws in effect like the Mortgage Debt Relief Act which protects the homeowner from tax consequences if the property in question is their primary residence. Income properties or 2nd homes, however, may have a tax consequence in a short sale. These situations will need a little extra thought and we strongly recommend that you consult a knowledgeable short sale tax professional. They will be able to assist you with the proper forms when completing your year-end tax return.
Ultimately, for a short sale to be approved, you must prove to the lender that you are in danger of losing your home to foreclosure due to something beyond your control such as job loss, illness, or the current market crisis. In most cases, completing a short sale is usually a much better option than foreclosure when it comes to the impact to your credit history.
Here are a few tips for the homeowner contemplating a short sale:
Are you upside down on your mortgage or underwater on your home? Professional Residential Brokerage, LLC can help.
How We Work:
As REALTORS® at Professional Residential Brokerage, we will assist in negotiations with your lender while placing your property on the market. This is the very beginning of the short sale process. Remember, we are trying to prevent a foreclosure to save the credit rating for the homeowner.
We will start at a suggested marketing price and lower the asking price as needed to attract a buyer and a contract to purchase. Once the contract is accepted and signed off by the homeowner, the contract is submitted along with the entire short sale packet. We go to work to make sure the lender has the facts on the local market as well as submit your information so the lender approval process can get started. Typically, a short sale is approved by the lender within 120 days of submitting the short sale packet. On occasion, it will be a longer approval process when there is a GSE (government backed entity) as the investor.
A few extra tips like the ones below can be found on our Short Sale Q and A link above...