Do you need to short sell your home?
Don't know what a short sale is? A short sale occurs when the amount of the outstanding loans is greater than the value of the home. This could be attributed to many reasons, but most commonly is a result of a rapidly declining real estate market.
For many homeowners, a short sale is an ideal way to prevent foreclosure or bankruptcy when they can negotiate with the lender to forgive the remainder of the loan.
What steps do I take in a short sale?
First, find out the true market value of your home. An experienced REALTOR®, like Coldwell Banker High Country Realty, will be able to give you a good idea of what your home should possibly sell for based on prior sales of similar houses in the neighborhood. Be careful of websites where a computer estimates your property's market value since they may not have complete information or know important things like neighborhood trends and current listings.
Next, estimate your closing costs. My work in this area means I know to take into account fees like title report, appraisal, escrow, property taxes, and agent commissions to calculate your final costs upon closing.
Finally, contact your lender and notify them of your situation. They may even have a special department that manages short sales. Ask about their exact process. Some lenders will be more able to work with you than others. They may be able to decrease your loan principal or make other arrangements. Your lender will have to give approval for the final sale.