According to the Nick Timiraos at the Wall Street Journal, "Home sellers learned a painful lesson in June: if you want to sell right now, lower the price. June marked the second month with no more $8,000 tax credit for home buyers, and some 24% of all listings that were on the market as of July 1 had experienced at least one price reduction, up from 9% of all listings one month earlier, according to real-estate website Trulia.com."

At first glance, news coming from real estate experts may sound dire for persons underwater on their mortgages and facing foreclosure.  These home owners might wonder how declining home values would ever help them out.  After all, if you're underwater on your mortgage and facing foreclosure, don't you want your home to increase in value so that you can sell it and pay off your mortgage?  Well, ideally yes, but there is another option.

Short sales offer homeowners a means by which they can sell their home and have their debt forgiven.  Often, short sales sell for less than other homes on the market.  At a time when real estate experts are telling homeowners to cut prices on the standard sale of their home, individuals short selling their home already have a built-in price advantage.  Since the expiration of federal and state tax incentives back in June, the market has cooled down and the few buyers that remain are looking for a good deal on their home purchase.  For many of these buyers, a short sale is a good deal.

If you're a homeowner who finds a short sale appealing, there are a couple of things you should be aware of.  First, most real estate agents do not have experience short selling homes.  If your agent claims to be a short sale expert, ask them how many short sales they've closed.  Short sales are not like standard sales and require whole different level of expertise.  Second, you should find an agent who will partner with lawyers who will examine the terms of your sale to protect you from recourse language.  If recourse language is not removed from the terms of your sale, then you're still on the hook for any debt not covered by the sale of your home.

We recommend working with our partner companies Rasmussen Law Firm and Fitzpatrick and Prince Real Estate.  They are experienced, short sale experts here to help anyone living in the Orange, San Diego, Los Angeles, and San Bernardino counties.  Give Mark, Whitney, or Blake at Fitzpatrick and Prince Real Estate a call today and let them help you out: 800.880.9962.