You Never Have to go through Short Sale Alone

Do you owe more on your house than what it is worth? Are you fighting to avoid foreclosure? Engaging in short sale, the last ditch effort to avoid foreclosure, is not a fun process, but can be helped. With the right counseling and resources, you can even save your finances.

Home short sales are sales of property that are for less than the amount owed on a home, often through a mortgage or home equity loan. As lenders often need to approve a sale before it can proceed, lenders do not typically approve of short sales unless debtors can demonstrate financial hardship. After all, lenders prefer to have their loan repaid in full.

That said, when lenders are given the choice between short sale foreclosure or other government action, they choose short sale. What is the reasoning behind this? Normally, lenders do not mind a few foreclosures, but since the housing market crashed in 2007, lenders have had to process millions of foreclosure requests, and had to write off hundreds of billions of dollars. Given the choice between losing everything and recouping some of their principal, banks often chose the latter.

That still leaves you in a lurch. Short sale applications often take months to process, and once they do, they tend to have a lower listing price. Worse yet, short sales go onto a credit report, and destroy your credit. After all, the loan does not vanish after a short sale, but simply remains with a lower principal.

So how can you find short sale help? The first place to look is often lenders themselves. As mentioned before, lenders see short sales as a necessary but painful process on them, and want to make the process as easy for you as possible. They often have low cost or no cost credit counselors available to help you protect your credit score, and financially manage what remains of your loan.

Another avenue is a real estate lawyer. Many real estate lawyers have worked with lenders in the past, and know how the system operates. A real estate lawyer can help you speed a short sale application, and maybe even reduce or forgive what remains of your loan.

Whatever you choose, you do not need to face short sale alone. If you keep dialog open with your lender, you can seek help. In fact, with guidance, you can even see short sale as an opportunity.

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