The national economy is still suffering following the recent financial crises. We know that means some Moultrie residents may be suffering too. There’s no shame in finding yourself in a little difficulty with the mortgage, it’s happened to many good and decent folks in these last few years. However, it is important to get help to avoid the worst financial penalties of defaulting on a loan.
That’s where a good real estate agent in Moultrie can help. We can give you tailored advice that may help alleviate the burden. One of the processes you might want to consider is a short sale, which may quickly reduce or wipe out all your current debt.
So What Exactly is a Short Sale?
If you think you might default on your loan (or have already started missing payments) then a short sale is a device that enables you to sell your home for less than the outstanding loan value. You may be wondering how that will help you and not just the lender, so let’s go through this together:
- Reducing the amount you owe means reducing the interest payments you have to make on any outstanding balance. It also means avoiding fees and charges for late or missed payments. Those are real (and substantial) dollar savings.
- In some cases if you have mortgage insurance it may be possible for the insurance provider to pay the shortfall on the balance of the loan. That means you could be able to walk away without any debt at all. This isn’t a guarantee but it is possible, your realtor will be able to help you examine this in more detail.
If you’re wondering why a lender would agree to help you like this, it’s because:
- Lenders don’t want to manage properties, they want to lend and collect money. Time spent away from their core business costs them money and that means a short sale actually saves them money too.
- Lenders also have an incentive to recoup as much capital as possible, particularly given the rough ride that banks have had recently. So a reduced sum that’s in their accounts may offer more benefit than a theoretical one that is tied up in your property.
It isn’t always easy to get a lender to agree to a short sale but the process works like this:
- You give the lender notice of your inability/reduced capacity to pay and request the right to sell your property or premises at less than the full loan value in order to reduce the financial burden on yourself
- The lender will then assess the application and use a team of assessors to examine your ability to pay, if they agree that a short sale is in both parties interests – they will then usually approve your application
You’ll need to be patient during this process, as it can sometimes take a couple of months or more for it to be completed. Once you’ve reached an agreement with the lender, your Moultrie realtor will then be able to help you sell your home and begin escaping the burden of debt.
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