It is a known fact that owning a home is an American Dream. Sadly, there are already millions of families whose dream was taken away by foreclosure. It is perhaps the singularly most embarrassing and traumatic experience that a person or family can go through. For this reason, you should protect yourself and your family from foreclosure by opting for a “short sale”.
Simply put, a short sale in the world of real estate means that the lender is allowing you to sell your home for an amount that is less than the mortgage debt you owe. The difference is usually forgiven but may become taxable income.
Although a short sale is sounding more and more attractive, you should realize that not all lenders agree to this option especially if they stand to incur more losses compared to proceeding with a foreclosure.
In order to get the approval of the lender, you will need to provide proof that you can no longer afford your mortgage. In most cases, a Hardship Letter will suffice. This letter should contain facts about your current financial condition and should convince the lender that you really are in no position to pay your mortgage debt.
If the reason is job loss, long-term sickness or death in the family, you might have a good chance of getting their approval as long as you provide the necessary documents to support these claims.
Along with your Hardship Letter, you will have to provide an updated Statement of Assets and Liabilities. This document should contain all information to support your claim of financial difficulties including savings accounts, bonds, stocks, cash, negotiable instruments and other things that possess tangible value. Include a copy of your bank statements as well.
If you are found to be qualified for a short sale, you have successfully avoided a foreclosure! The next step is to find a real estate agent or broker that will help you find a buyer.
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