19 Apr

Why an Owner Wouldn’t Do a Short Sale

It’s funny…

… I advise that you sell your home in a short sale rather than do a loan modification or a foreclosure. However, there is even a downfall to doing a short sale.

Here is what I decided. I am going to list the positives and negatives for each of the above options and I guess you can decide which works best for you.

LOAN MODIFICATION

Pros:

You get to keep your home
Your monthly mortgage payment will be lower

Cons:

The bank usually asks for a substantial downpayment
You will still owe the bank more than what the house is worth

FORECLOSURE

Pros:

You will no longer have the bank hassling you about a payment
You will no longer have to deal with obnoxious tenants (if applicable)

Cons:

You will have a negative blemish on your credit
You will have problems buying a home for at least 3 years

SHORT SALE

Pros:

You can negotiate that an investor pays you to take over your home
You will not have a foreclosure on your credit report

Cons:

The bank can come after you for the balance that was written off due to the short sale
You may have to pay taxes on the loss amount (loan amount minus short sale price=loss amount)

These are the pros and cons to each one and I guess it is up to you to decide what works best for your and your family’s needs.

Tags: foreclosure, loan modification, short sale
Posted in Foreclosures, Short Sales | No Comments »

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Why an Owner Wouldn’t Do a Short Sale