Short Sales Foreclosure - 4 New Short Sale Myths That Shatter Many Homeowners

By Author: J.J. Yong
Total Articles: 962
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Homeowners that are seeking financial help to stop foreclosure would be excited with the possibility of a short sale, nevertheless remember that the possibility of accomplishing a short sale is not as simple as one may think! Due to the term 'short' sale, one may expect the transaction to be finalized in a quick, hassle-free way, but the reality is far from that! Short sales would take longer to settle than normal real-estate sales, and expect at least 6 months to 1 year (or even more) for the contract to finally close.

The only thing that would be 'short' in the event of a short sale would be the reduction of price of the property in question, and if the seller does not want to settle the balance once all the loan/obligations has been settled, the lender must agree to absorb the differences to close the deal. Let us now look at 5 of the newer myths that have been circulation around with regards with this real-estate transaction:

1) the 1st myth - it's better to walk away from your homes rather than to short-sell it. This is one of the more weird myths that I have come across in the past few months, ...
... as walking away from your home would leave you at the risk of your lender who has the liberty to sue you on your defaulting balance, while some states can impose state taxes on your mortgage debts (could go up to tens of thousands of dollars), thus you would actually be getting into more trouble than before!

2) the 2nd myth - that short-selling your home is the same as stop foreclosure transactions. For the record, when you perform a short-selling transaction, you are actually selling your home at a value that is lower than what you owe for it, while pre-foreclosure dealings are actions taken to deal with those that are behind on their monthly mortgage payments. Two completely different scenarios if you ask me!

3) the 3rd myth - that the bank/ lender is obliged to do certain and specific things - in reality, the seller's bank has the liberty to refuse your request to short-sell, or even request for more money from you (or even the new buyer). The lender can also make agents reduce their commission fees as well. Thus remember, the bank has plenty of rights to do almost anything that they want before your request is accepted

4) the 4th myth - that the process of short-selling is simple, and there is a clear guideline to follow of what the bank/ buyer/ seller can and should do - in the real world, there is nothing normal or standard of the process of short-selling your home, there is room for plenty of negotiations, and there definitely would be!

You can stop home foreclosure with this option, but take into account all what has been mentioned above to avoid getting the false conception when you opt for short sales! All the best!
Find out more information about stop home foreclosure and hardship letter to stop foreclosure via StopForeclosureReality.com.