Did anyone here do a short-sale as the seller?

How was the experience? How long did it take? How bad did it hurt your credit? You can FM me if you feel more comfortable. I'm seriously thinking about this...but I'm afraid of the long-term effects. I am current on all my payments right now, and this is really my last resort because it's getting hard to keep up. Thanks.

Re: Did anyone here do a short-sale as the seller?

I haven't personally done one as a seller, but here is my perspective as an agent:

If you are going to do a short sale, you should find a good real estate attorney and agent who can guide you through the process. You will give your listing agent authorization to discuss your loan with the bank and generally act as an intermediary for you.

You need to be prepared to provide a lot of financial information - - tax returns, bank statements, etc., and disclose your expenses (utilities, grocery bills, etc.). So the process is easiest when the seller is organized and on top of the paperwork and generally cooperative. You will also need to prepare a persuasive "hardship letter" explaining what has changed that has brought you to your current situation (e.g., job loss, illness, divorce, etc.).

As far as how long it takes, it depends on how long it takes to find a willing buyer, like with any other sale. At first, you have to price the property at a point that shows the bank you are trying to recoup their money, but that price is often too high to generate activity. So then as you drop the price, the activity should increase.

A short sale will affect your credit, but obviously not as much as a foreclosure. I've hard it is generally 2-3 years before you can buy a house again if you've done a short sale, but again, it depends on the circumstances.

ETA: Since you are current on your payments, have you tried to get a loan modification to lower your payments and avoid a short sale situation?

Good luck!

Message edited 3/23/2011 8:13:04 PM.

Re: Did anyone here do a short-sale as the seller?

You won't get approved for a short sale unless you can prove financial hardship.

My broker tried to encourage me to do a short sale but I think that was just because the offer that had come in at the moment was so low we couldn't afford to take the loss (it would've been about 45k+ plus closing costs + comission).

A good credit score is very valuable. I wouldn't want to tarnish it with a short sale unless absolutely necessary.

Re: Did anyone here do a short-sale as the seller?

I just met with an attorney and a seller who I just listed as a short sale

the reason peoples credit gets trashed has more to do with the years worth of mortgage lates then the short sale

if you can stay current during the process the impact on your credit wont be as bad (a charge off)

You must be able to prove that you are going to default in the future and that you are being pro-active- if you can prove this the short sale will be approved (my clients are current on this short sale so this was discussed in detail)

(FYI divorce falls into this category)

Now what happens after you are approved and close

you will get a 1099 for the defiencey

if you never refied and this is your primary residence- all liabilty will be waived

normally as a condition of the short you are released from liabilty- but there is a chance the bank will come after you for the difference

the first mortgage most likely will be close to be satified

but the 2nd usually gets $2-$6k

they might ask you to come to the table with something or you might have to work out something with them after

you will not know this until the short sale is approved

if you do end up paying the 2nd - they will take very favorable payment arrangements- this will also lessen the impact on your credit

call me with questions on this- I wish you were in NY b/c I have such a great team put together for short sale- but when you ready I will tell you what to look for an agent and help you find one

Re: Did anyone here do a short-sale as the seller?

I've called the bank for the HELOC to ask if I could turn the HELOC into an unsecured personal loan (not against the house), so I could pay it off in time without going the short sale route...they said no.

I went through a divorce. I am self-employed and business has been horrible since September of last year. I believe those 2 things would qualify me as having a financial hardship.

I have the name of an attorney and RE agent here in NJ, but I haven't called them yet...trying to gather some info so I can ask the right questions when the time comes.

Message edited 3/24/2011 10:31:33 AM.

Re: Did anyone here do a short-sale as the seller?

Re: Did anyone here do a short-sale as the seller?

Re: Did anyone here do a short-sale as the seller?