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Specializing in Anderson SC, Lake Hartwell, Lake Keowee, Anderson County SC, Oconee County SC, Pickens County SC

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What is a Short Sale Anyway?

An increase in foreclosure rates will inevitably bring with it an increase in short sales. But what is a short sale?

A short sale happens when you sell your house for less than your remaining mortgage balance, the proceeds of which go to the lender and in return the lender forgives the remaining balance. Selling your home as a short sale is one way to avoid foreclosure.

As a general rule, lenders lose money when they foreclose on a property. Consequently, they would rather not have to foreclose if it can be avoided. A short sale represents an opportunity to cut their losses because a short sale usually allows them to recoup more of the cost of the loan than a foreclosure process would.

However, don’t think that a short sale is an easy thing to accomplish. In order to get permission for a short sale, you must provide documentation showing a genuine financial hardship. And don’t think that the decision for accepting a short sale is solely in the hands of the lender. Sure the lender must first agree, but this is not the final word. If there is mortgage insurance involved, this company also gets input on the decision. If there is an investor backing the mortgage, they also get input as to whether to accept a short sale.

The transaction process for a short sale can be rather cumbersome as well, whether you’re on the buying or selling side. Many short sales fail due to additional demands by the lender, such as requiring the broker to reduce his or her commission and/or that the seller signs a document requiring him or her to pay back the shortfall.

If you’re on the selling side of a short sale, consider having your agent or other experienced professional negotiate with your lender for a better deal. And remember, if the lender does accept a short sale and forgives part of your debt, that is considered taxable income and you must declare it as such to the IRS.

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Carola Dauchert, Realtor Broker/Owner
Carola Dauchert Real Estate
1203 N. Fant St.
Anderson, SC 29621
Phone: 864-226-5473

Residental Property Sales
Anderson, SC and surrounding areas
Lake Hartwell & Lake Keowee
 

Testimonials Page

Carola provided professionalism and kindness through the entire process. We chose Carola due to the many "sold" signs on her listings in the surrounding area. I would highly recommend Carola to anyone who asked if I knew someone that would be a joy to work with and would get the property sold in a timely manner! Becky Lynch
Carola helped me when I was looking to lease office space in Anderson, SC. She showed me several properties and offered lots of options. She took the time to answer all my questions and educated me during the process. Ultimately, I found a property to purchase and she helped with the negotiations, getting me the best price available. I would recommend her to anyone buying or selling in the upstate of South Carolina. sbmesaros
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