Clicks and Mortar

A Real Estate Blog - Est. 2009

Quick Clicks: Atlanta Short Sales

Posted on 01, June 2009 by csadmin
  • Depending on the circumstances and the bank involved allow several months for final approval of Atlanta short sales. If the home has a first and a second mortgage with different lenders or a Private Mortgage Insurer, short sales can take a long time to be finalized. The process is a long and arduous one for all sides.
  • In most cases, the lender wants the home to sell because:
    • They don't want a non-performing asset on their books. This affects how much they can lend out and therefore affects the amount of interest they can generate.
    • It can be very costly for lenders to go through the foreclosure process
  • Not all sellers or homes qualify for short sales. 
  • If you are the seller in a short sale your credit score will most certainly drop, but the damage is not as significant as with a foreclosure
  • As a seller, you will need to prove hardship on your part as to why you can't make your payments. You will essentially go through a bizarro loan process in an attempt to show why you CAN'T pay instead of why you CAN afford the home.
  • In approved short sales, the bank pays the commissions to the real estate agents involved. These commissions are wide-ranging depending on the net proceeds to the lenders involved.
  • Some banks are requiring that sellers bring some cash to closing before they will forgive large portions of a mortgage debt.
  • In some circumstances you may owe taxes on forgiven debt. If it is your principal residence, you'll be covered by the Mortgage Debt Relief Act of 2007.
  • If you are selling your home as a short sale, you need a good real estate agent. You need someone to navigate the paperwork, keep in constant contact with the bank, and properly market your Atlanta short sale. You need them to show the lender that this is the best price this home will yield and that if they foreclose on the property they won't be able to sell it for more because it has already been properly prepared and marketed for sale
  • Lenders would rather work with real estate agents instead of the seller directly for several reasons:
    • Selling homes is a Atlanta real estate agent's profession
    • Real Estate agents are less likely to commit fraud, since this is their livelihood and any transgression could potentially cost them their career
    • Insurance
    • Experience
    • Less emotional about the circumstances

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