Don't Enter a Short Sale Agreement on Your Own—Partner with an Attorney
Foreclosure is a scenario that no homeowner ever wants to face, but the unfortunate reality is that life can happen at any moment, and lead to this scenario. During this stressful time, owners sometimes have the ability to engage in a short sale as a way to offload the property before it is formally foreclosed upon. Short sales can be highly advantageous, but these agreements must be carefully prepared or there could be further issues down the line. Here, you can learn why real estate legal services can help ensure you enter a fair agreement.
Approval Is Necessary
When a mortgage company enters into an agreement with a borrower, they do so with the belief that the borrower will pay back the loan in full. When a borrower wishes to enter into a short sale agreement, they are ultimately requesting that the mortgage company take a loss, given that the purchase amount of the home will be at an amount that is less than the mortgage balance. A mortgage company is under no obligation to automatically agree to these terms; you will need to get the approval of the mortgage company.
Deficiency Judgement
The short sale of your home does not necessarily mean you are all clear. Even after the short sale is complete, the mortgage company can initiate what is known as a deficiency judgment. A deficiency judgment occurs when a mortgage company seeks a judgment for the balance of the unpaid mortgage, minus the short sale amount. It's critical you seek a waiver for judgment when you prepare and finalize the short sell agreement with the mortgage company. An attorney becomes critically important in this instance to minimize your threat for this outcome.
Time Restraints
Time is not on your side when it comes to a short sale. When you make a request for a short sale, the mortgage company will generally provide a timeframe by which a buyer must be found, and a sale agreement finalized. If you do not finalize a sale within this period, the mortgage company can move forward with the foreclosure. It's critical that you understand the terms of the agreement to ensure you do not surpass the timeline.
Attorney Protection
It's important that you protect yourself during this process. You do not want to enter into a short sale agreement blindly; you want to make sure you know exactly what you are getting yourself into. A partnership with a real estate attorney will ensure you are protected.
Keep these factors in mind before you entire into a short sale agreement. For more insight and assistance, contact real estate legal services.
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