If you are thinking about putting up your Arizona real estate for sale, and you are not in a good financial standing with your mortgage, then you might want to consider short sale. But what is a short sale? Many of my clients, friends and family are still asking me questions about a Short Sale. Let me explain the details as best as possible, but still seek legal advice if you intend to proceed with a Short Sale.
Arizona homes for sale via short sale mean that the lender is accepting less than the total amount due on the mortgage owed. However, not all lenders will accept short sales or discounted payoffs, especially if it would make more financial sense to foreclose; moreover, not all sellers nor all properties such as Tuscon luxury real estate qualify for short sales.
A homeowner will submit paperwork to show that he cannot make the mortgage payments; paper work consists of bank statements, income tax records and other updated records. Lenders have a loss mitigation department that evaluates potential short sale transactions.
The homeowner/debtor sells the mortgaged property for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender. The Banks will incur a smaller financial loss than foreclosure. There will be some damage to credit history for the seller, but not as bad as a foreclosure. Many short sale homeowners can purchase another home within a three year period depending on their credit history. If you foreclose on a property, the period of time to buy another home may be up to seven years.
Going through a short sale is a win-win situation for the homeowner, getting out of a financial predicament, and salvaging your credit. The lender wins by avoiding timely and costly foreclosure proceedings. The buyer wins by getting a property at a good market value, and can even go on searching for other homes in Tucson if they wish to stay.
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