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Short Sales — Part III of Short Sale Series 

 Previous Posts:

• Related Previous Posts:

  • Colorado Springs Homes, 4 things to know about a short sale – Part I of Short Sales Series
  • Avoid Foreclosure, Know Your Options – Part II of Short Sales Series
  • The final step in the Colorado Foreclosure process – Part IV of Short Sale Series
  • How long does it take to do Colorado Springs Short Sale? – Part V in Short Sale Series
  • Are there tax ramifications to a Colorado Springs Short Sale – Part VI

   

The Benefits of a Short Sale:

1. The Seller avoids a foreclosure on their credit report.
2. It can help the Seller with a solution to an embarrassing situation.
3. A home may be spared abandonment.  (Some short-sales homes are vacant, but they typically aren’t abandoned)
4. The Buyer gets a house at a good price; and typically the home is in better shape than a foreclosed house.
5. The Bank gets more money, while minimizing their costs.
6. The Bank does not have to seize, evict, manage, clean-out, maintain and resell the asset. This is a big savings to the bank.
7. The Neighborhood is spared another boarded-up vacant foreclosed house in the area.
8. Other Sellers in the area are spared the stigma of a foreclosed home that brings down the property value in the entire neighborhood.
9. Owners who are trying to refinance or sell their home will have their home appraise higher by being spared another foreclosure sale in the area.
10. The Realtor who could not sell the home because it was priced too high now has a home that can be sold as a short sale.
11. The Seller will be eligible, under Fannie Mae guidelines, to buy another home in 2 years instead of 5 years.

The Negatives of a Short Sale:

1. There is no guarantee the lender will accept the short sale offer.
2. Waiting for the bank to respond to an offer is frustrating for both the buyer and the seller.
3. The lender will want to examine personal records such as tax returns, bank accounts, assets and liabilities, in addition to asking for a hardship letter from the seller.
4. The derogatory credit will remain on the seller’s credit report for 10 years.
5. The courts get less money with fewer foreclosures.
6. Law firms that do foreclosure work make less money.
7. Companies that board up and winterize homes make less money.
8. Foreclosure auctioneers make less money.
9. Collection companies who are hired by the banks make less money.
10. Criminals who conduct business in vacant homes make less money.
11. Scrap yards that accept stolen copper make less money.

 Disclaimer: This post is not intended to be or to provide legal advice. I recommend that you speak to your attorney and your tax accountant regarding specifics

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Kathy (719-287-1049)   KTorline@msn.com