Short sales homes refer to properties that are sold short of the balance owed on the loan in order to stop foreclosure. Short selling is typically the last option offered to borrowers who have defaulted on their mortgage note. The process is complex and often requires assistance from a real estate lawyer.

In order to purchase short sales homes buyers are required to obtain preapproved financing Asics Gel Respector Footwear Moon Beam White Ireland , unless presenting a cash offer. Many real estate investors seek out short sale properties to expand their investment portfolio. Oftentimes, investors will buy preforeclosure homes with cash in order to further negotiate the asking price.

Not all banks engage in real estate short sales, nor do all borrowers or their property qualify for approval. Although the short selling protocol varies by lender, most require borrowers to be a minimum of 31 days delinquent on their note and owe more than their property is worth.

Whether buying or selling short sales homes, the transaction must be supervised by the servicing lender's loss mitigation department. Borrowers undergo an extensive financial audit to ensure they are financially insolvent and do not possess assets that could be sold to satisfy the loan balance.

Borrowers should be prepared to provide wage statements Men's Asics Onitsuka Tiger Mexico 66 Shoes Black White Ireland , bank statements, current and previous years' tax returns, investment portfolios, detailed list of income and expenses, and a short sale hardship letter.

The hardship letter is an integral part of obtaining short sale approval. This document gives borrowers the opportunity to explain the circumstances which caused them to fall behind with home loan installments. Bank loss mitigators prefer short sale hardship letters to be written in chronological order and include information about any remedies borrowers have taken to overcome financial challenges.

Loss mitigators compare the original loan documents to wage earnings and personal tax returns. If borrowers provided erroneous information when taking out the home loan Asics Onitsuka Tiger Mexico 66 Slip On Shoes All White Ireland , they could be subjected to a mortgage fraud investigation. Depending on the state of residence, individuals convicted of mortgage fraud can face up to 15 years in prison and fines up to $1,000,000.

Since short sales homes result in a financial loss to lenders, many banks hold borrowers responsible for monetary deficiencies between the sale price and loan balance. If mortgagors are unable to pay the deficiency amount in full Asics Onitsuka Tiger MEXICO 66 DELUXE Shoes All White Ireland , banks can obtain creditor judgments. Deficiency judgments remain on credit reports until fully repaid and can prevent borrowers from obtaining any type of credit for years to come. Additionally, banks can persue wage garnishment to obtain restitution.

Borrowers should strive to obtain a 'Payment in Full' short sale contract when possible. When banks engage in payment in full agreements they accept the sale price as satisfaction of the loan balance and borrowers are able to walk away from their property without owing additional funds.

Individuals facing foreclosure must contact their bank immediately, as once the foreclosure process begins short selling is no longer an option. Individuals who obtain short sale approval may want to seek out private real estate investors to buy their property. Investors are attracted to distressed properties because they are sold below market value and can make good investments.