Do you need to short sell your home?
Not sure what a short sale is? A short sale is when the amount of the outstanding loans is greater than the amount for which the home could sell. This can be caused by many factors, but frequently is a result of a rapidly declining real estate market.
For many homeowners, a short sale is an ideal way to preclude foreclosure or bankruptcy when they can negotiate with the lender to forgive the remainder of the loan.
What steps do I take in a short sale?
First, figure out the true market value of your property. A qualified real estate professional, like Greater R.I. Properties, LLC, will be able to give you a good idea of what your home will likely sell for based on a market analysis. Be cautious of websites where a computer estimates your property's market value since they may not have complete information or know important things like neighborhood trends and current listings.
Next, calculate your closing costs. My work in this area has taught me to account for fees like title report, appraisal, escrow, property taxes, and agent commissions to tally your final costs upon closing.
Finally, contact your lender and notify them of your situation. They may even have a special team that deals with short sales. Ask about their particular process. Some lenders will be more inclined to work with you than others. They may be able to reduce the amount owed or make other arrangements. Your lender will have to approve the final sale.