Answers
Can someone please explain Home Short Sell?
My home has been on the market 6 months. I'm struggling to pay the mortgage to prevent foreclosure. Is short sell bad? Will it hurt my credit? How long does it stay on the credit? Can I ever buy another house with a short sell on my credit? Will the bank allow me to pay the difference to prevent credit damage?
Best Answer:
To a future lender, a short sale is the same as a foreclosure. Just like lenders treat credit counseling the same as Chapter 13 Bankruptcy. The benefit of a short-sale to you is this: 1) Make sure that you can avoid a deficiency judgement if they agree to the short-sale. (the biggest benefit). 2) You avoid thousands of dollars in fees because the lender does not have to seek legal remedies to get you to move, you agree to it when your home is sold. 3) If all of your payments have been on time (which is usually a requirement for a short-sale) is that they generally don't ding your credit. There are telltale signs on your credit that you have had a short-sale and it is usually when the final payoff is less than the last reported high-credit balance. The underwriter will call the mortgage company to double check to see if it's a short-sale (this is a ROUTINE thing that underwriters look for on credit reports), and that is when they will confirm that it is. That is when the undewriter has to manually make sure that the new mortgage has met seasonal requirements for a foreclosure, which also means ZERO lates on rental history, and no more than 1, 30-day late on other lines of credit, and credit must be re-established. Seasoning for A-paper is a minimum of four years. That is how it really works.
Answers:
A short sale is an option, is a voluntary transaction where the property is sold for less than the amount owed to the lender.
The lender will loss money and depending in if it was a purchase loan or a refi loan they can go after your assets or tax you for the loss the lender had.
But you avoid foreclosure.
if your property is listed, ask your agent for more info if he doesn't know, get another with more experience.
You can always pay the difference but it is not worth it.
talk to a lawyer, they will give you a free consultation and offer you many options.
Here is some info
http://www.intellibiz.com/shortsal.html