Loan Modification?
Short Sale? Foreclosure?

Every day homeowners face foreclosure because they cannot keep pace with their monthly payments. You are not alone. I can help.

Complicated times require sensitive solutions. We’re all in this market together. When it comes to real estate, know your options.

A short sale is a win-win solution for the home owner and the lender. Borrowers get relieved from their mortgage debt and get their credit restored quicker.

What are the benefits of a short sale? When a short sale is successful, there will not be a foreclosure, which can damage your credit for up to 7 years (and bankruptcy up to 10 years).* Many experts believe that a foreclosure is much worse than a bankruptcy.

Can investment properties be short sold? Yes. Any type of property can be sold through short sale.

Don’t wait until it’s too late, find out what your options are today. I’m offering 100% free guidance and advice for homeowners who are underwater with their mortgage. Whether you want to keep your home or sell it, get a no-obligation assessment by contacting me today.

*Credit information is subject to change without notice.

Prepare for your short sale.

Requesting a short sale approval from your lender can be a streamline process if you prepare your paperwork in advance. Each lender has different requirements for documentation, but the following is a list of typical documents needed for the short sale.

• Two most recent paycheck stubs for each person on mortgage loan (if self-employed, provide the year-to-date Profit and Loss Statement).
• Bank Statements. Please include the two (2) most recent bank statements for your checking, savings, mutual funds, 401k account, and other investment information.
• Hardship letter, which is a detailed explanation as to why you are unable to continue making payments.
• Statements of Disability/Unemployment, Retirement and/or Social Security benefits applied for or received.

Along with these items, your lender will usually require that you have a valid offer to purchase your property. By hiring Mike Kelly as your real estate broker, he can take charge of marketing your home to buyers.

Typical requirements to meet in order for your short sale to be approved.

This is a brief overview of typical requirements lenders require in order for short sales to be approved. It should be noted that each lender has their own specific requirements.

• Proven inability to pay your mortgage based on your current financial situation.
• You must cooperate and allow the lender to view the interior of your property to enable them to determine an appraised value. A second interior value maybe required if there is 30% or more decline in value from the origination value.
• If there is a deficiency, the lender may require that you make a contribution toward any such deficiency from the sale of the property. This contribution may be in cash and/or a promissory note, depending on the lender’s review of the potential sale of the property and your financial situation.
• Your property must be listed with a licensed real estate agent/broker (such as Mike Kelly) at a price based on “fair market value.” The sale transaction must be “arm’s length,” which means that all parties involved in the sale must be unrelated and unaffiliated.
• If there is a deficiency, the lender may require that you make a contribution toward any such deficiency from the sale of the property. This contribution may be in cash and/or a promissory note, depending on the lender’s review of the potential sale of the property and your financial situation.
• You may not enter into an agreement with a third party to surrender the title to the property and arrange a short payoff in exchange for a fee.
• You cannot receive any proceeds from the sale of the property or any hazard/flood insurance claim. In addition, you must waive reimbursement of any escrow; buy down funds, or pre-paid items.

Important factors to consider when short-selling.

When completing a short sale, your lender usually elects to consider the following:

• The lender will consider the debt to be satisfied in full.
• The lender will release your mortgage on the public records.
• The lender will file a 1099-C Form with the IRS and send you a copy. This may be a taxable event. You should consult with the IRS or a tax professional concerning any tax impact this may have to you, if any.
• The lender will report the transaction to the credit bureaus as “PAID IN FULL FOR LESS THAT THE FULL BALANCE.” This may be considered a derogatory remark by future potential or actual creditors. Credit is not subject for negotiation. Aurora will not report the loan “PAID IN FULL” unless we receive a payoff of the full amount due under the loan. We will continue, without change, our reporting activity to the credit reporting agencies with respect to your loan, until completion of the short payoff transaction and we have received and posted good funds representing the agreed upon short payoff amount.
• Your lender  will usually continue to pursue all available collection and foreclosure processes/activities until such time as the lender has approved your request for a short sale transaction. The short sale application does not suspend or postpone your obligation to make your monthly payments.

In addition to contacting our office, you may call the HUD Nationwide toll free telephone number at 1-800- 569-4287 to obtain a list of the HUD Approved Housing Counseling Agencies.