In February, 48% of all existing single-family homes sold in Orange County were distressed. This means that nearly half of the homes sold, which were not newly built, were either the product of a short sale or a foreclosure. There are many reasons for this. First, unemployment is still high and many are without work. For these people, paying their mortgage is simply not possible. Second, rising fuel and food prices have crunched people's budgets making mortgage payments untenable. Finally, some people have made the choice to strategically default on their mortgage payments since their home is no longer worth what they owe on it. These are just a few of the reasons for the large volume of distressed homes on the market.
Recent headlines in the news have given rise to optimism that homes could rise by as much as 23% in the next five years. This is good news and everyone hopes that it turns out to be true. However, some people don't have five years to wait for home values to rise. For others, this increase in value may not even be enough to make up for what they lost in the market crash.
Currently, people have four options: They can live in their home for another 10 years or however long it takes for them to recuperate the amount they paid on the home, they can sell their home at a loss and walk away from the sale oweing money on a home they no longer own, they can stop making payments and have their home foreclosed on, or they can short sell their home. Unless one wants to spend many more years in their home, a short sale is the option that makes the most sense.
A Short Sale is the sale of real estate in which the sale proceeds fall short of the balance owed on the property's loan resulting in the lender forgiving debt in order to avoid foreclosure. The thing to know about Short Sales is that they are more complicated than standard sales as they require much negotiation with the bank and prospective buyers. For a short sale to succeed, you need people with short sale expertise who understand the process and can push the sale through to completion.
If you think a short sale might be right for you, 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.