Short sale is an inevitable option when a homeowner cannot comply with his or her monthly dues. Although the effect of this sale in the borrower’s credit standing is not as bad as with foreclosure, it is still a feared reality.
Despite the fact that both borrowers and lenders do not want this to occur in their investment, still there are facts that the former should know. These facts are usually kept from them to protect a lender’s interest in the process.
Short sale secrets that lenders do not divulge:
1. One of the delaying strategies used by lenders and banks is the timeline of the sale approval. Lenders have loss mitigation departments that take care of the concerns and issues about a short sale. It requires immeasurable documentation and other kinds of requirement before granting approval. In these cases, it is detriment for the seller, who regardless of getting a qualified buyer for the home, may still face a possibility of losing it because of the extended waiting period. This is done indirectly but is definitely a helpful method of preventing a short sale.
2. Lenders do not tell you of the market value, which they consider confidential like the market value of the property that is listed for this type of sale. They may include the expected sale margin for the home, which is equally necessary. The lack of this substantial information usually discourages potential buyers resulting to delay of the sale.
3. In home buying, there are obviously costs of closing, fees and charges required for the acquisition process. This is another integral fact that many lenders do not disclose to borrowers to prevent short selling your home. Often, buyers find themselves in compromising situations that forced them to back out of the deal because of is lengthy application process.
4. Lenders will not inform you that they make private arrangement with investors, which are done behind your back. Sadly, many agents stay blinded by the real estate industry as a whole. Most only want to believe that their real estate transactions are the only means in which lenders can truly move the property. Sales in terms of performing and non-performing notes are responsible for most of the swaps but these sales are not stated in public records because they are sold at a very low price.
Take into consideration that your home is only the icing of the cake. Most lenders are not happy in visiting or seeing your property than you thought. As a matter of fact, when you express your sentiments to do a short sale, they are mostly indifferent. The only thing that interests them is your payment. Nevertheless, lenders want to reassure that the borrowers have an emotional bond to the home.
Both lenders and borrowers have an important role in short sale cases, nevertheless, both parties are continuously on the lookout for ways to protect each of their interests. In the event that lenders deny you of vital information you must know about a short sale, you can always inquire from real estate consultants and professionals to a solution to your dilemma and find possible solution to the problem.