Is it time to short sell your home?
What is a short sale? A short sale happens when the amount of the outstanding loans is greater than the value of the home. This situation is usually caused by home values in a market rapidly deflating.
For many homeowners, a short sale is preferential to 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, find 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 realistic idea of what your home would possibly sell for based on prior sales of similar houses in the neighborhood. Watch out for websites where a computer estimates your house's market value since they may not have complete information or know important things like neighborhood trends and current listings.
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Next, don't forget about your closing costs. My work in this area has taught me to take into account fees like title report, appraisal, escrow, property taxes, and agent commissions to calculate your final costs upon closing.
Finally, call your lender and make them aware of your situation. They may even have a special department that manages short sales. Ask about their exact procedures. Some lenders will be more able to work with you than others. They may be able to lessen how much you owe or make other arrangements. Your lender will have to agree to the final sale.