Jim Shevlin - All-Ways Agency
Jim's Contact Information
Toll Free Phone: (888) 475-1180
Toll Free Fax: (866) 295-6752
Email Address: jim@jimshevlin.com
Office Information
All-Ways Agency -
105 Atsion Road, Suite A -
Medford, NJ 08055
(800) 728-7355
Neil Vogel, Broker/Owner
Your New Jersey Real Estate Agent if you are Buying or
Selling a home in Camden
or Gloucester Counties
Short Sales
A "short sale" is when the net proceeds from the
sale of a property are not sufficient to satisfy the outstanding mortgage(s) on
the property, and the seller is unable to pay the difference. Often in
cases like this, the lender is wiling to take less than is owed on the property
in order to allow the sale to be completed.
Why do Short Sales
Occur?
Short sales occur for a variety of reasons. Sometimes,
people are just not able to afford the mortgage payments, and the property is on
the verge of foreclosure, or eve IN forclosure. This may occur because of
protracted illness or disability, loss of employment, or just because the
borrower was not realistic and borrowed more than he or she could afford.
The latte is often the result of the liberal lending policies of the last few
years. Rather than go through the foreclosure process, lose the home at
sheriff's sale, and destroy his or her credit, the seller will try to sell the
property to satisfy the loan.
If the seller has to sell the home because
of a job transfer or a divorce, and if the seller took out a 100% load, an
interest-only loan, a loan with negative amortization, or a loan with a
prepayment penalty, the seller may find that after normal selling expenses there
is not enough money left to pay the mortgage in full. A declining real
estate market exacerbates this situration.
What is the benefit
to the Seller?
A forclosure is one of the worst things to have on
your credit report. A short sale is looked upon more favorably. In
some cases, as part of short sale negotiation, a lender may agree no to submit a
negative report to the credit reporting agencies.
What is the benefit
to the Lender?
Lenders don't like to be in the real estate business,
and they don't like to carry inventories of houses. A lender's balance
sheet looks poor when the lender is carrying a lot of underperforming or non
performing loans.
I a property goes through the forclosure process, the
lender will almost always realize less from a sheriff's sale than from a private
sale, and the lender will have to pay court costs, attorney's fees and seriff's
commissions, further eroding the lender's equity in the
property.
