A short sale can be a great way for homeowners who must sell and owe more on thier home than it is currently worth. Unfortunately a number of myths about short sales have developed and it is very important to understand the reality of the proces!
Myth 1.the bank would rather foreclose than bother with a short sale
this is the most common misconception. The reality is that banks do NOT want to foreclose on proeprty because the foreclosure process is costly. Banks, investors and even the Federal Government have all publicly stated that if a person is QUALIEFIED for a short sale, the deal needs to be considered.
Myth 2. An owner must be behind on a mortgage to negotiate a short sale
While this may have been in previous times, TODAY the lenders are looking for VERIFIABLE hardship, monthly cash flow shortfall, or pending shortfall and insolvency.
Myth 3. There is not enough time to negotiate a short sale before foreclosure
This myth probably HURTS THE HOMEOWNER THE MOST!! Many do not realize that the foreclosur is a process, and there is time to make decisions that may result in better outcomes.
Myth 4. Listing my home as a short sale is an embarassemnt
According to recent estimates 1 out of 5 homeowners in the U.S. in in the same situation. YOU are to be CONGRATULATED for admitting you need help, taking ACTION and finding a professional to help you work towards a solution.
Myth 5. Short Sales are Impossible and never get approved
Yes and NO! A short sale is difficult no doubt about it. Does a hoemowner need to learn the process? Absolutely! Are they impossible? yes at times they will feel that way but they are NOT impossible just long, tedious and need lots of patience and they can be done.
Myth 6. Banks are not accepting short sales
The reality is that banks and the Federal Government are trying to do anything they can, within reason, to avoid foreclsoing. It is absurd to believe they would deny a short sale and go for a foreclosure or even more stupid to think future legislature will pay them for their losses.
Myth 7 Buyers are not interested in short sales
FALSE! Many agents get phone calls from buyers who say they only want foreclusres or short sales. The dilemmas if any come from all in the timing for all parties concerned.