Realty Executives Gallery Properties (Orlando)

Serving Orlando, FL

Realty Executives Gallery Properties (Orlando)


Short Sale Tell All

(Published on - 8/4/2020 5:01:15 PM)

A short sale is when a lender agrees to accept a mortgage payoff less than what is owed on the house. This is basically done to facilitate a sale of the property by a financially distressed owner. The lender takes over the remaining balance of the loan. Buying a home through a short sale is a little different, and we are here to tell you how. Also, there are drawbacks and benefits, so being educated is important.

First, the steps needed to take to short sell a home start with a hardship letter from the seller to state why the mortgage cannot be fully paid along with any documentation and paystubs/tax returns. The lender will then use the information to decide whether the short sale is approved or not. If approved, the property will be designated as such when listed and offers will be sent to the lender/seller, as normal, to counter or reject.

Benefits- Seller Side:

Less stress: Seller avoids emotional turmoil of maintaining fees they cannot handle.  

Savings: Normally, the seller handles closing fees and agent commissions, but in the case of a short sale, the fees are handled by the lender.

Credit score recovers faster.

Avoids foreclosure.

Drawbacks-Seller Side:

Lender would need to approve first before anything can be done.

No Profit: The seller will not profit anything from the short sale as all proceeds will go to lender.    

Benefits-Buyer Side:

The seller/lender are motivated to make a deal to avoid foreclosure and to recoup losses, so they will work diligently to work something out.

Less Competition: The complexity of short sales and the uncertainty of the time frame will dissuade some buyers; hence, the buyer has less competition.

Drawbacks: Buyer Side:

Longer Timeline: The paperwork process is longer for a short sale (up to 120 days) than for a traditional home sale (around 45 days).



Questions? Need Advice? Complete this form for more information.

Contact Information::

Copyright 2021 Realty Executives All Rights Reserved
Disclaimer: Each office independently owned and operated. Please disregard this message if you are already under contract with another real estate professional.