Frequently Asked Questions

What is a Short Sale?

A Short Sale is a Lender’s voluntary acceptance of less money than is owed to allow a property to be sold as an alternative to foreclosure.  It is only available on houses in pre-foreclosure (or is imminent it will go into pre-foreclosure) and are overleveraged.  A short sale can be negotiated on all mortgages and junior liens.  It is not available on bank owned homes (REO's).

Why would a Lender approve a Short Sale?

Lenders are in the business of loaning money, not managing and selling real estate.  If the Lender believes the Short Sale offer is better than what they would net if they took the property back at foreclosure and sold it themselves, they will most likely approve a Short Sale.  The costs of taking a property back in foreclosure are tremendous for the Lender, including accrued interest, attorney's fees, listing charges, and maintenance costs.  Non-performing loans reduce what can be loaned by 2 - 8 times the amount of bad debt.

How much is this going to cost?

Not a penny!  There are absolutely no fees or costs to you or to the Realtor. 

How do I know if a property is a Short Sale prospect?

If the homeowner is behind on their mortgage, has some sort of hardship, and does not have the financial ability to solve the problem on their own, then it might be a good Short Sale prospect.  Run it through our Are You a Good Short Sale Candidate? analysis and fill out a "Submit Your Info for a Short Sale" with the details – we will contact you and let you know whether we think we can help with a Short Sale.

Why would I want to do a Short Sale?

A successful Short Sale will prevent a foreclosure from appearing on your credit report.  A foreclosure is much worse on your credit than a bankruptcy.  You can recover from a bankruptcy in about 2 years....a foreclosure will take 5 - 7 years.  Fannie Mae has recently issued guidelines that will allow a new home loan 2 years after a short sale, but not until 5 years after a foreclosure.   It can prevent you from getting credit cards, buying cars, and more.  Also, studies have show that your FICO score is impacted less by a short sale than a foreclosure.  In addition, lenders will often seek a default judgment for any deficiencies.  When you pursue a short sale, any deficiencies can be negotiated as part of the process, so you have a much better chance of NOT having ANY deficiency.   Also, if the house goes all the way to foreclosure, by the time the lender gets the house resold, any deficiency will be much greater than if the house sells with a short sale.  In pursuing a Short Sale vs. foreclosure, you will also have the satisfaction of knowing they tried everything possible to fulfill their obligation to the Lender on the money they borrowed.

When do I have to move out of the house?

You can stay in the house up until the time the Short Sale closes, so long as you have moved out by the day of closing.  However, many homeowners move out sooner for various reasons.  Most find suitable housing elsewhere and go ahead and move so they don't lose it.  From the lenders perspective they would rather see someone living there to maintain the property and deter vandals, but so long as we let them know that the property is secure they are ok with it.

Should I file for bankruptcy to stop the foreclosure?

If you are considering bankruptcy, you should consult a bankruptcy attorney.  However, we can tell you this.  Bankruptcy does not prevent a foreclosure.  You put up the house for collateral on the loan, the lender has the right to take the house back to recover what they can.  The bankruptcy can delay a foreclosure, but it will not prevent it.  Lenders will usually not consider a Short Sale while you are in bankruptcy, as this is considered to be a collection activity, and they are barred from collection activities by the bankruptcy.  If you are filing bankruptcy just to stop the foreclosure, it is not a good idea to do so if you are contemplating a Short Sale.  However, if you are filing due to other considerations, that is best determined by you and your bankruptcy attorney.

What do I have to do?

If you don't have a Realtor, just fill out the "Submit Your Info for a Short Sale" form.  If you have a Realtor, just tell them you want to work with us.  If they introduced us to you, we will handle it from here.  If they don't know us, we will instruct them what they need to do.

 

More Questions?

Call us at (502) 639-9628 or click here to contact us .  We look forward to hearing from you!

 

 

IMPORTANT NOTICE:

Plum Properties LLC, Susan Breckel, LLC Basswood Realty Services LLC and/or any affiliated or related parties are not associated with any government agency or program, and our company is not approved by the government or your lender(s).  Even if you accept this offer and use our service, your lender may not agree to change your loan or approve the short sale. If you stop paying your mortgage, you could lose your home and damage your credit rating.