3 Times to Consider a Short Sale

Often times I am asked the question by clients, friends, colleagues "When should someone consider a short sale?" It is important question today and it is important to know that a short sale is an option that may not work for all but should at least be considered. So today we wanted to address situations and time frames on when you should consider a short sale.

• You are currently 30 days or more behind on your mortgage and you can't catch up - Now this is important. There are times when people get behind on their mortgage because they are working on a business, tending to family, or waiting for a disability payment that they are guaranteed will come in. If you are behind in your mortgage and know you will be able to make it up call your lender and explain your situation to see if they can work with you to adjust your payments temporarily. If you can't catch up and know you will not be able to make up the payments calling your lender immediately and asking for short sale information is important.
• You are about to miss your first payment and you know you will not be able to make future payments - If you can see that you won't be able to make future payments because your loan is adjusting upwards then contacting a real estate professional is critical. Often times people have enough equity to sell but not to refinance. It is important to get this information from a specialist. I always recommend speaking to a real estate professional and a lending professional. I do not recommend speaking to 1 person who does both lending and real estate. Have the real estate professional or the lending professional refer you to someone that they have used on their own home. If you don't know anyone or didn't like the last service you received try the bank or credit union you bank at or ask a friend whom you trust.
• You have received a Notice of Default (NOD) from the lender - This means they have filed the legal paperwork recording that you are in default of your mortgage. This notice must be on record for at least 90 days. They cannot set a sale date of your property earlier than 21 days after this 90 days has been completed. If an NOD has been filed and you cannot make up the payments I recommend contacting your bank and a real estate professional trained as a loss mitigation specialist immediately to help you.

If you are just having problems making payments or you are out of work temporarily these may not be strong enough reasons to consider a short sale. Short sales are great at helping you avoid foreclosure but they will cause you to have to sell your home. Always seek qualified advice from real estate professionals, tax professionals, and legal guidance as you deem appropriate.