It's big news nationwide: Bank of America has halted foreclosures and other banks are expected to follow suite. The halts come as a much needed reprieve for many homeowners behind on their mortgage payments. Because of this, it's tempting to believe the halts to be good for homeowners as well as the housing market which has been burdened by distressed homes. Sadly, the exact opposite might be true.
The halt will certainly not be permanent. At some point, homeowners behind on their mortgage payments will have to answer for those payments. Very few homeowners will be able to catch up on their payments during this brief halt. Worse, the housing market may see a brief uptick in prices before prices come crashing back down. Banks have a backlog of homes which they've already foreclosed on. Once they resume foreclosures, they'll resume placing their distressed properties back on the market which will, once again, drag down the overall housing market. On balance, it may be that the halt in foreclosures is bad for homeowners and the market. Time will tell.
However, the foreclosure halts are not all bad. They have the benefit of buying homeowners more time to take action and do something about their mortgage situation. There are only two ways to avoid foreclosure: 1) catch up on your mortgage payments or 2) short sell your home. If option number one isn't realistic for you, it's time you look seriously into option two.
Here's what you need to do to get started on a short sale:
First, find a reputable real estate agent with a track record of success in short sales. Short sales are not the same as standard (equity) sales and they require a knowledgeable person to see them through to the end. Don't rely on tag lines like "short sale expert." Paper certificates from a brief seminar aren't good enough. Ask to see proven results.
Second, make sure you have an attorney reviewing the terms of the sale. A good short sale attorney may be able to eliminate "recourse" language from the sale thereby stopping banks from trying to collect on your mortgage debt in the future.
Third, don't hide anything about the home. When you find an agent, tell them the full story so that nothing surprises either the agent or the bank. When negotiating a short sale, surprises put the success of the sale at risk.
Finally, be ready to wait. Unlike standard sales, short sales require negotiation and negotiations take time.
We recommend you work with Fitzpatrick and Prince Real Estate and Rasmussen Law Firm. They have a proven record of success having closed 95% of their short sales. Nationally, the average short sale closure rate is only 20%. Additionally, these companies have worked together on a number of short sales, they understand how the other operates, and can move quickly, together, to negotiate with the banks to close your short sale. Start the conversation today with Mark, Whitney, or Blake at Fitzpatrick and Prince Real Estate.
Give them a call at: 800.880.9962.