Short sales are a great way to wipe out your debts, but it can be a hard ball to get rolling. If you tried to get a loan modification and you’re nearing foreclosure, you most likely already qualify for a short sale; but if you are just starting to fall behind on your mortgage payments or are upside down on your mortgage, you may not be there yet. Getting your lender to authorize a short sale will mean finding a buyer and getting everyone who holds your debts to agree to the sale price.
You Can Still Make Your Payments During a Short Sale
Contrary to the information that’s out there, you can keep paying on your mortgage until the home is sold, depending on the lender. You may even be able to salvage your credit and be in a new home as long as you weren’t delinquent on your payments. If you’re not able to sell your home on a short sale offer, you’ll be able to cancel the listing and stay in your home, and keep making your payments. While this isn’t the happiest outcome for someone who needs to relieve themselves of a mortgage payment every month, you’ll be able to stay in your home and you won’t be penalized.
If You Choose to Quit Paying Your Mortgage During a Short Sale
If you choose to quit paying your mortgage payments and pursue a short sale offer, there are some benefits. First, if your house doesn’t sell you’ll have enough money to move out and move on; I don’t even have to go over all of the expenses of moving in Southern Maryland. If the bank isn’t getting your hard earned money, they’re more likely to agree to a short sale to recoup their losses, but they may pursue a deficiency judgment against you if they’re unable to get the full debt repaid.
If the Short Sale Fails, is Foreclosure an Option?
If you can’t find a buyer for your Southern Maryland short sale home, you may face foreclosure for stopping your mortgage payments. This is just one of the consequences you might face for not paying, so you need to be prepared just in case. Many people start down the road to a short sale, stop making their payments and inadvertently end up in foreclosure; with the right Southern Maryland real estate agent (like me!) who specializes in short sales, you’ll have a better chance of avoiding foreclosure and saving your dignity.
If You Stop Making Payments and a Short Sale Succeeds
Congratulations, you’ve escaped foreclosure! But if you stop making payments you may face derogatory reports on your credit to the big three bureaus. You’ll also have to wait 2+ years to qualify for a Fannie Mae mortgage.
If you want your short sale to succeed, you need a southern Maryland real estate agent that’s been through the process before and can guide you through it. Check out my short sale information form here.