Short Sales in Milwaukee
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What is a “Short-Sale” and why it should be an option?
A Short-Sale is when a homeowner lists their home for sale at a price comparable to other recent home sales in the immediate area, even if it will not be enough to pay off the full delinquent mortgage. The competitive price will attract offers at today’s value. This offer must then be submitted to the mortgage lender to see if they will accept this price, as full satisfaction of the amount the borrower owes.
Will a Short-Sale save my credit?
Nobody can state exactly how a Short-Sale affects credit because each Short-Sale is unique and each future lender has its own way of evaluating credit risk. The homeowner, Realtor and lender jointly establish the specific terms and conditions for the Short-Sale approval. In general, if the mortgage is paid up to date or has only 1-3 missed payments, a Short-Sale could have very little negative impact on a credit score. This is much better than a foreclosure, which affects credit for 7 years and is one of the worst items possible on someone’s credit history. Another factor affecting credit is the specific way the lender reports the Short-Sale to the credit agencies. If the mortgage is reported as “Satisfied” it will have less impact that if it is reported as “Short-Payoff”, “Settled for less than owed” or “Settled”.
Even these options are much less damaging than a foreclosure or even a “deed-in-lieu-of-foreclosure". Homeowners facing a Short-Sale or foreclosure should consider enrolling in consumer credit counseling to learn steps to re-establish their credit.
What are some of the benefits of Short-Sale?
We hear from our clients that one of the biggest benefits a homeowner gets out of a Short-Sale is “A sense of pride that you attempted to work out your situation in the best possible way”. Other reported benefits include “less stress from the constant collection calls from the lender(s)”, “more time in your home” and “the opportunity to create a better plan for moving”. Additionally, the home stands vacant for much less time than a foreclosed home. This is important for the friends, relatives and neighbors around the home who would be negatively impacted by ‘an abandoned house”. Lastly, in some cases, the homeowner and Realtor might be able to negotiate with the lender to get the homeowner a ‘relocation’ payment to assist in moving out after the Short-Sale closes.
What are some of the challenges of a Short Sale?
Short-Sales can be difficult to negotiate and take longer to close than ‘regular’ sales. The lenders generally require extensive paperwork prior to approving a Short-Sale and the lenders are not required to approve any amount less than a full payoff. For these reasons, many Realtors are reluctant to list these properties for sale because of the amount of work extra work and expense it requires.
My Solution
My team provides Short Sale representation to sellers with the same respect and honesty we show all our clients. We are experienced in working with Short-Sales, we can provide up-front advice on what will be needed to successfully complete the Short-Sale. We provide bi-weekly updates to homeowners A Short-Sale listing is marketed like all of our listings. We make the same marketing efforts (internet, full-color flyers, multiple photos, etc.) for every listing. We keep sellers up to date on legislation that may assist with both sales and relocations.
