The current real estate market has been difficult for many people, but is especially difficult for people trying to sell property. Many sellers have found that they owe more money on their property than it is worth. This is often referred to as being “upside down.” Others are behind on mortgage payments due to their adjustable rate mortgages resetting or because the creative financing terms that were previously available have ended. And of course others simply lost their jobs or face another financial hardship and can no longer afford their mortgage.
Whatever the reason may be, for many sellers, a “short sale” may be a viable solution. A short sale is when the lender agrees to accept a loan payoff that is less than the full amount due on the mortgage. It is true that this may adversely affect the credit score of the seller, but it is not as damaging to a person’s credit as a foreclosure or bankruptcy.
If you are a homeowner contemplating a short sale, call our office, 312-238-9298, for a free 15-minute consultation. Our office has a lot of experience handling short sales and we can answer any questions you have. It does not matter whether you live in Chicago, Berwyn, Naperville, Orland Park or another suburb. Our office handles short sales all over the Chicago area.
Here are 10 important points to remember about short sales:
1) They take time. On average, short sales take three months. But it depends on the lender. I have had some properties close in one month.
2) The seller will need to prove a financial hardship in order for the bank to consider the short sale. If you have a lot of money sitting in your checking account and are just looking for the lender to take the loss on the property, a short sale is not for you. Through our office and your real estate agent, we will provide the necessary paperwork for the lender to consider your financial hardship. In my experience, lenders have been very responsive to the financial hardships of sellers and will likely agree that a short sale is the best option.
3) The seller typically receives no proceeds from the sale; however, my office can sometimes get “relocation assistance” funds for the homeowner. The bank pays all customary closing costs such as agent commissions, taxes, title fees and attorney’s fees.
4) All real estate sales contracts should use the appropriate short sale rider.
5) The seller must still accept an offer; however, it will be subject to lender acceptance. In other words, the lender must approve the terms of the offer as well as sign off on the seller’s financial hardship circumstances.
6) There is no guarantee the bank will approve the sale; however, my office has a high success rate.
7) When an offer is presented, the bank will do its own research on the property by ordering a brokers price opinion (“BPO”). This is similar to an appraisal. Therefore, if the offers are lower than what other homes have been selling for, the lender may reject the short sale or counter at a higher price.
8) It is very important that the seller, listing agent and our office work together. This will ensure that the process goes as smoothly as possible.
9) Sellers should use a real estate agent and attorney who are experienced with short sales.
10) Sellers should get our office involved immediately. If you have stopped making your mortgage payments, call us right away to get started on a short sale. Bradford Miller Law, P.C., has extensive experience with short sales and can help ensure the process goes as quickly and smoothly as possible.
Contact Bradford Miller Law, P.C.
To schedule a free initial consultation with an experienced Chicago real estate lawyer, contact our office online or call us toll free at 312-815-6637. Meetings can be set up for weekdays, between 8:30 a.m. and 5 p.m. We charge reasonable fees for all services
Disclaimer: This website is for informational purposes only. It does not constitute legal advice and is not intended to create an attorney-client relationship. Please consult an attorney before acting on any information.
Bradford Miller Law, P.C.
10 S. LaSalle
Chicago, IL 60602
Toll Free: 312-815-6637
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