Given the significant financial problems that impacted so many people in the United States and the slow recovery that is still being experienced in some areas, short sales have become more common. It is first important to understand that the availability of a short sale is not an absolute. Specifically, it occurs when the owner of a home gets special permission from their lender to sell the home for less than what is currently owed, frequently in order to avoid foreclosure. Due to the complexity of this type of sale and because they are often so-time sensitive, it is best to consult with a real estate attorney to help you throughout the process. Therefore, it will be very helpful to ask the following questions when you are choosing the right lawyer to help you sell your new home through a short sale.
#1-Should You Quit Making Your Payments Before Asking For A Short Sale?
It is important to note that the type of home loan you currently have will influence whether or not your payments will need to be in arrears in order to be approved to sell your home for less than what is owed. In addition, there is no guarantee that failing to make your payments will allow you to be approved for a short sale. Therefore, it is best to get advice specific to your own situation before you delay the first payment.
A real estate lawyer with experience in short sales will be able to advise you as to what you can do to improve the likelihood of a short sale, whether that is not making payments or approaching the bank directly. If your loan is through the government or guaranteed by them, it is more likely that you will need to be behind on payments.
#2-How Will A Short Sale Impact Your Credit?
Since being late with your house payments or not making them at all will usually affect your credit score, legal advice will be essential. In addition, many states don't prevent lenders from going after former home-owners for the balance between the home's value and what it actually sold for. As a result, it can be very challenging to be sure that you are financially sound with as little impact to your credit score as possible.
That means that you will need to make sure that you are working with an experienced real estate attorney who can help you draft a contract that releases your own financial liability for the deficit. At the same time, you can get advice about limiting the impact of late or missing house payments and a short sale on your credit score.
In conclusion, a real estate attorney is uniquely qualified to help you sell your home through a short sale. As a result, it is a good idea to ask the right questions when choosing your attorney, so that you can more effectively protect your interests throughout the process.