As property values fall and foreclosure numbers rise, more people are looking into short sale when selling their home. Due to the recession, many homeowners are finding it increasingly difficult to keep up with their mortgage payments and some fear losing their home. If this sounds familiar to you and you are selling your house, you may be eligible for a short sale.
This decline in property value teamed with unemployment and the increase of adjustable rate mortgages makes it a popular option for people trying to sell their homes in the recession. Read on for short sale information if you are selling your house and want to know more.
The number of mortgage lenders that are offering these programs to help people sell their homes is increasing with the start of 2009. For more information on what a short sale is or help for if you are selling your house, read on. If you are selling your home and are struggling to pay your mortgage you could be eligible for this. See if the following information applies to you.
What is a short sale?
Well, it is an agreement between the homeowner and the mortgage lender (bank) to sell the house at a reduced price. This is done to avoid foreclosure. Foreclosure is a costly and lengthy process for both homeowners and banks. As a result, more and more lenders have introduced these programs.
Who qualifies for a short sale?
Homeowners who can't or are struggling to pay their mortgage repayments. Also, if the homeowner is now trying to sell his home before the house goes into foreclosure. Generally, this happens when a homeowner has missed more than one mortgage payment. The mortgage holders will agree to a short sale if the homeowners are not going to be able to sell their house for enough money to pay off the existing mortgage amount. They will accept such a discounted price if the amount is less than what would be spent during the this process.
How do you do it?
In almost all short sale agreements the mortgage holder has to present a statement of hardship to the lender. This statement will detail the reason why you are unable to continue paying your mortgage. This could be loss of a job or reduced income. It could also be due to hospitalization or medial emergencies. Or, it could simply be that an increase in their mortgage made it impossible for them to pay. The real estate agent will help you write this.
If you are selling your house, you will also need to provide a statement of income. This will list all of your assets including your savings account, other types of bank accounts, money market accounts, stocks, bonds and shares and real estate. The lenders will make sure the information contained in this statement matches that of the statement of hardship. In other words, they will want to make sure you are as hard up as you say you are in your statement of hardship.
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