Introducing: A Simple Guide to Short Sale and Foreclosure- PART 1

Hello, My name is Joe Salcedo.  My sole purpose for this article is to help you answer any of your questions regarding short sales and foreclosures.  At the end of this article you will find other related articles that I wrote (and other experts) for the sole purpose of helping you understand more about this topic.

If you feel overwhelmed about this topic know that this is far from simple and you are not alone.  I promise to help you any way I can.  You can call me directly at 775-338-7653

                                                                                                            -Joe

Foreclosure

Homeowners Predicament:

• Ruined Credit
• May end up owing after the foreclosure
• Collectors chasing: Judgements & garnishments
• Shame

Solution

Short Sale

• Avoids some of the problems listed previously
• Creditors get more of their principal sooner
• Short Sale has the same time frames as an ordinary sale- easier exit.

Short Sales

What is a short sale?

• A short sale is the sale of a property, for less than what is owed, by obtaining permission from all the secured creditors to do so.

Who takes short sales?

• Any creditor, secured by collateralized real estate,whose equity position in the property is compromised.

Parties involved in a Short Sale

1.   Homeowners- provide copies of notes, prepayments & loan balances.
2.   Listing Agent- letter of authorization signed.
3.   Loss Mitigation Officer
4.   Trustee
5.   Additional Lien Holders
6.   Title Company
7.   Appraiser or BPO from Realtor

       

         
Difference Between Short Sale vs. Release of Lien

• In a short sale the creditor settles in full the amount owed by the debtor for a value that is less than what the creditor is owed. The remaining balance is forgiven.  The homeowner no longer owes anything to the creditor.

• In a release of lien, the creditor removes its security interest in the property but the amount owed is not forgiven.  The homeowner still owes a balance to the creditor.

Short Sale vs. Release of Lien

• A creditor that authorizes a short sale will issue a settlement letter stating that the debt is settled in full for a specified amount.

• A creditor that releases a lien will, prior to releasing the lien, make the homeowner sign a new promissory note, not secured by a trust deed on the property, stating the value of the debt and the terms of payment/

• Listing agent keeps Seller informed w/ documentation as to what could happen, including foreclosure.

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" If you need answers to your short sale questions now, you can call me directly for a no hassle-no pressure-phone consultation today! Joe: 775-338-7653"
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Read part two

Related reading:

• Why do banks take so long to approve a short sale?

• Confessions of a short sale expert

• To short sale or foreclose? I share my experiences

• Randi Bennett talks about short sales and foreclosures