What is a Short Sale?
When a mortgage lender agrees to accept less than the full amount owed. The home owner is required to have a current or future hardship like divorce, job loss, income reduction, or relocation.
I've missed mortgage payments, what will happen?
In Illinois home owners have about 6-12 months (some times more ) from the 1st missed payment missed. Contact your bank and see if you can work out a payment plan. Acting fast will give you more options like a modification or a short sale which take 2-6 months.
How do I complete a short sale?
First your home will need to be listed with a Realtor ( recommend a CDPE agent). Most importantly you will need a qualified and patient buyer becuase the process can take 2-6 months from start to finish. Your bank or mortgage company will require a lot of your financial almost like applying for a loan.
What is a C.D.P.E?
C.D.P.E or Certified Distress Property Expert is a Realtor who has gone through extensive training in helping home owners avoid foreclosure. C.D.P.E agents can help home owners complete a short sale on their home where many traditional agents fail. They have a 70-80% success rate of helping home owners avoid foreclosure where the average Realtor only has a 35% success ratio.
Homes Affordable Foreclosure Alternatives is a government program designed to help consumers execute a short sale with the cooperation of their mortgage company. The main benefits are the speed of the transaction and $3000 in moving cost assistance. Not all loans or home owners will qualify. Your loan must be owned by Fannie Mae or Freddie Mac.
A 2nd mortgage can be negotiated in the Short Sale. Most often the 1st mortgage will agree to pay 3K-5K from total proceeds of the sale.
What Will happen to my Credit Score?
Your credit score will be negatively impact, but nothing near having a foreclosure ( worse than Bankruptcy). After a short sale your credit report will usually show "debt settled for less than owed"
What is a deficiancy judgement?
Deficiancy judgement is the difference of what you owe on your mortgage and the actual amount recovered from the sale of your home. With a short sale this can be negotiated where as a foreclosure can not. After a foreclosure your mortgage company may to recover the difference.