No one likes having to go through the process of a short sale. It’s difficult both financially and sentimentally. However, a short sale is much more preferable than a foreclosure for many different reasons. For starters, it’s much easier to buy another home after a successful short sale than a foreclosure. Financial institutions view short sales as an attempt by the homeowner to pay off the remaining balance. Foreclosures, on the other hand, tell the same financial institutions that home owners washed their hands of the property and let the burden fall on the lender. Big difference! And that’s just for starters—here are five tips to make you a savvy short seller and how to make the most of an unfortunate situation.
Foreclosures are like bankruptcy, it will never go away. Even after its mandatory term on your credit rating (7 years), it can still come back to haunt you later on down the road. Sure, you can have it removed—again and again. But, there is no guarantee that a foreclosure will stay off of your credit reports even after a correction or three.
A short sale is like credit consolidation—the ramifications are much easier to tolerate and you don’t suffer the stereotype that bankruptcy and foreclosure entails. You may even be eligible to buy another home in 2 years as opposed to the 7 year sentence a foreclosure carries.
Really? Absolutely! Once the short sale has been approved, it’s up to you whether you pay your mortgage or not. There may be some residual credit damage, but again, it’s not even comparable to the damage a foreclosure brings. You can pocket a sizable chunk of your paycheck while waiting for a buyer to purchase the home.
As a bonus for sticking it out with a short sale rather than foreclosure, you may qualify for $3,000.00 to help relocate. That money could really come in handy when looking for a new place to live—a security deposit for an apartment, deposits on cable television, gas or electric or both, landline telephone activation and other moving and storage expenses. It adds up quickly so that $3,000.00 makes life a whole lot simpler.
This benefit enables you to have the pride to say you sold your home instead of losing it to foreclosure. Self-esteem and self-awareness are big takeaways from choosing a short sale over foreclosure. The mental and emotional frustration of a short sale pays off in the end unlike a foreclosure. Seven years is a long time to reflect on the prospect of owning your own home again and this could weigh heavily on people who choose foreclosure. Mental health is definitely a factor to consider when making this decision.
Keeping your dignity intact is an important component of a short sale. The process mimics an actual real-estate transaction and that’s frustrating enough. It doesn’t remotely compare with the stress felt by those who undergo foreclosure. Demand letters and litigious threats make foreclosure almost unbearable for some. Attorneys can freeze any assets you may have during foreclosure. Sounds intimidating, right? With a short sale, you control the flow of the sale and the only real responsibility you have is to keep your home immaculate while potential buyers look at the house.
For more information on short sales, or if you’re trying to sell your property in a short sale, please call Jim Huckfeldt at 609-433-6599 or visit his website at firstteamrealtyexchange.com.