Short Sale Information – Will my Lender Approve my Short Sale?
Many people don’t consider a short sale because they think their lender will not approve them and why bother with the whole thing if it’s not going to work. They either have a neighbor or relative that tried to do a short sale and it ended in foreclosure so why bother. First of all I want to be very clear – a short sale is much better for you than a foreclosure. I need to state that the advice in this blog is general in nature and applies to California law only.
In California there are some great consumer protections but if your first mortgage forecloses and you have a second you could be looking a lawsuit to collect the second in your future. Whereas with a short sale the second goes away paid in full. Your personal credit report is better with a short sale and you will recover quicker. Some people think they are getting back at the bank when a foreclosure occurs but the bank doesn’t care and you suffer more not the bank. My opinion is that is always better to do a short sale than just letting your house go in foreclosure.
I talk to people every day about their financial situation. Most times it’s because they have or had an upside-down mortgage and didn’didn’t quite know how to handle it. To be sure there is A LOT of information out there and it is very confusing. I’m a lawyer focusing on this area on a daily basis and sometimes I get a little confused too. The difference is that I know where to find a conclusive answer while most homeowners do not.
When I hear someone tell me that they don’t want to bother doing a short sale because the bank won’t approve them I almost always tell them that they can in fact do a short sale. The main reason most fail is because they have a real estate agent helping them and they don’t have a lawyer on the team.
“But I can’t afford a lawyer” is a common response I hear. Well they actually can afford a lawyer when I help them because they pay me NOTHING when I help them with a short sale. I’ll explain how I can do that but first I want to explain why a real estate agent is the worst resource you can use for help with a short sale.
Short sales are really about legal issues. Such as: can the bank sue me, can they garnish my paycheck, can they come after my retirement accounts, will I owe the IRS any money, etc… Notice I didn’t mention the smell of oatmeal cookies during the open house or how we can stage your house to show the best. Those are great things when you are trying to squeeze every ounce of equity and then a very sophisticated and experienced agent can help but in a short sale you are not going to get any equity. So why would you talk to a salesperson when it’s really the legal issues that are your most important concerns.
Real estate agents cannot give legal advice. It’s actually a criminal offense to practice law without a license and if your agent is answering some of the legal issues you face then they actually are practicing law and breaking the law. A good agent will tell you that you should consult with a lawyer about the legal issues (and almost everything in a short sale is a legal issue). Most lawyers are charging anywhere from $3,000 to up to $10,000 to oversee and negotiate a short sale.
I have created a system where you pay nothing. Because I am a licensed real estate broker AND an attorney I can give you the legal advice you so desperately need and handle the real estate issues as well. We have created a system where the bank and the buyer pay all the fees and cost so you pay nothing. The banks have lawyers on their side and now you can too!
Because I handle your case as a lawyer there are many things I can do when negotiating with the banks that real estate agents simply can’t do. We get the bank to play fair and by the rules and many times have to politely (and sometimes not so politely) explain to the bank from a legal perspective why they can’t do what they are trying to do.
Every one’s situation is unique and different but I rarely come across something I haven’t already dealt with. I have handled 100’s of short sales and have had very little problems getting the banks to approve them. Real estate agents on the other hand have a very poor success rate getting them approved according to industry statistics. When I handle your short sale you pay nothing and quite often we can get you $3,000 or more in moving costs at the close of escrow.
If you have any questions or concerns about your own personal situation I would be happy to give you a FREE one on one legal consultation. You can call me at 916.442.6400 or send me an email at firstname.lastname@example.org or just visit my website www.upsidedownca.com.
California Attorney and
licensed Real Estate Broker