The prospect of selling your property “short” of what you owe can be upsetting and intimidating. Who would have thought that owning your piece of the American dream could turn into a nightmare. Well, this is the grim reality for millions of Americans, but selling short may get you out of a bad situation.
Despite the pressure and awkwardness of this type of situation, a seller has to be at the top of their game. Success depends on not only working with your lender, or lenders if you have multiple loans, but also a qualified buyer who is willing to be patient and committed to the purchase of your property.
To give yourself the best chance at succeeding in this type of situation, please read the following recommendations and incorporate them into your short sale strategy.
Work With A Realtor: Don’t do this on your own. Hire a real estate professional who understands the short sale process, can explain it to you, guide you through it and work hard to get you a qualified buyer.
Do Your Research: Read up on short sales by visiting the California Association of Realtors website and the National Association of Realtors website. Knowledge is power, but applied knowledge is even more beneficial to you during this process.
Talk to your tax advisor regarding tax liability and any other consequences of doing a short sale.
Talk with your Realtor and understand the whole process from beginning to end including documentation, and time-frames.
Talk with your lender about their short sale package and be prepared to fill all requested paperwork out completely, promptly and in an organized format.
Be Proactive: Always remember, problems don’t get better with time!! Work closely with your lender and Realtor to address all requirements, questions and issues as they arise.
Be Prepared: To help yourself and your Realtor, talk with your lender ( even before you list your property ) to determine their short sale eligibility requirements and whether or not you meet those requirements. Every lender is different. Don’t assume anything! Also, ask how your lender treats the shortfall between what you owe and what the property sells for. Will the lender forgive the debt, require you to pay it, issue you a 1099 or say nothing. Get the answers in writing!
List Your Home At A Fair Price: Look at what similar properties have sold for recently as comparables. Provide the information to your lender to see if they will accept those sale prices. Have a strategy to lower your price a certain percentage if no showings or offers come in within the first 30 days, 45 days and 60 days. Price your home ahead of the market so it stands out from similar properties!
Keep notes on all showing activity, feedback from Realtors/buyers and be prepared to provide that to the lender.
Always Keep A Good Thought: Visualize an interested, qualified buyer making a full price, cash offer on your property. Envision a quick, pain-free escrow that transitions you on to a new road and the buyer into their dream home. Win-Win. It can and does happen, but you have to be an active participant. It’s in your best interest to do so.
For information on Mammoth Lakes real estate, including all distressed properties, please log onto my real estate website at www.easternsierraproperties.com
Please share your thoughts by leaving a comment or call me at the office: 760-934-5088.
Good Luck!!
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