Chances are, you or someone you know in Silicon Valley is facing the possibility of foreclosure. But you need to understand that you are not alone.
Today, 1 out of every 7 homeowners in America is behind on mortgage payments. These are tough and frustrating times. Now more than ever, it’s important to identify your options. Foreclosure can be avoided, your credit can be saved, and your financial future can be salvaged.
Through our experience handling distressed properties at Keller Williams, we’ve found that homeowners today have more questions than answers about their circumstances. We have created this site to help you understand the possible solutions to foreclosure, as well as provide a detailed explanation of short sales, which may be the best course of action for some homeowners.
You may also have noticed that we’re offering you FREE Reports to explain your options and help you decide on a course of action. The idea of losing a home can be overwhelming, and we feel it is vital for you to have all the facts necessary to make an informed decision.
As agents with the CDPE® Designation, we have a strong and unique appreciation of the factors affecting the market, and know that there are options available to you.
We are here to help … in any way we can.
Foreclosure is not an option. As you have learned from this video, there are other options which are less damaging to their futures for most home owners. As San Jose Short Sale Agents and Foreclosure Prevention Specialists, our team has the necessary training and the background to stand toe-to-toe with the lenders and successfully fight on your behalf; we may be able to help you out of your difficult situation by limiting the damage to your credit and preserving your sense of dignity.
Please contact us for a no-obligation consultation.
What exactly is a Short Sale?
A Short Sale has been referred to by more than one real estate professional as a dignified solution to a financial crisis. Simply put, it is when you sell a home for less than what is owed on it with the lender’s approval and the lender forgives you for the difference (what is short) between what is owed and for what it ultimately sells. (See What is a Short Sale Tab for technical requirements) It is now a recommended component of the Federal Government’s Home Affordable Foreclosure Alternatives (HAFA) Program and is recommended if you do not qualify for a Mortgage Modification.
Why would the lender agree to do this? Money. It’s always about the money isn’t it? (If your lender is WACHOVIA, we have a working relationship which may cut through the red tape) Typically, it is cheaper for the lenders if the house is sold prior to getting into foreclosure and being sold at auction. There are costly expenses associated with foreclosing on a home (aside from the fact that owners who are going through foreclosure typically destroy the homes before they are evicted); but with short sales, it takes less time (meaning less carrying cost for the lender) and makes more economic sense for lenders if the homeowners have an interest in and participate with the lenders in selling their homes, rather than fighting with them. The lender saves money because they don’t have to pay for eviction, go through an auction only to have to take the property back because the auction did not meet their floor price or no one attempted to bid, make repairs and then pay Realtors to sell it as a bank owned (REO) property which typically gets deeply discounted by buyers anyway; in the meanwhile, still paying for taxes, insurance, association fees, etc… that the seller failed to pay. A home where the seller still resides and maintains will fetch a much higher selling price than an abandoned eye-sore type of property that is typically an REO.
Why would it be good for the seller?
It allows them to have control over their economic future and sense of dignity. Let’s face it, if you are contemplating foreclosure, that means your financial situation will not be changing for the better in the immediate future. Don’t let others dictate your financial future; get involved and control and participate in your own financial outcome.
The most important facet to the short sales process is that it permits you to have control over your financial future. If you are forced into a foreclosure situation, your credit score will be devastated as you had no participation with the lender to help address the situation. The net result will be more devastating than bankruptcy from the Fannie Mae Underwriting Guideline point of view and you will not be able to qualify to buy a home or apply for a credit card for many years; additionally, now more and more employers are doing credit checks on prospective new hires and a foreclosure on your credit history may put you in jeopardy, especially if the job requires security clearance status or is a government position. And once you are forced out of your home, you will need to rent a property; with a foreclosure on your credit record, you will learn that finding a rental property will become more difficult and the down payment requirement will dramatically increase compared to people who don’t have foreclosure on their record. If you choose to take control and complete a lender approved short sale, you will be able to salvage your credit by more than halving the seasoning requirements (only 2 years) for Fannie Mae Underwriting Guidelines for re-establishing credit and give yourself the opportunity to be in a situation to buy a home again in a relatively short time. Naturally, individual situations will vary in results.
A mis-perception floating around out there is that the short sale Realtor works for the lender. That is absolutely wrong. The listing agreement is a contractual relationship between the seller and the Realtor; the lender is not a party to the contract and has no relationship with the Realtor. WE WORK FOR YOU and have a contractually obligated, fiduciary relationship with you! We look out for your interests.
Who pays for the commission?
Because you are facing financial difficulties, the lender is required to pay for the commission and associated closing costs for completing the short sale. (This is why some people believe the Short Sale Realtor works for the lender).
Time is not on your side, please take action.
The people you are speaking to at the lenders are trained professionals; you are not. Amateurs should not compete directly with professionals. Let us level the playing field for you to give you a fighting chance. Please contact us for a no-obligation consultation to see if we can help you avoid foreclosure.
(650) 605-3188 or steve@stevemun.com
