Mar 21

Short Sale Info Part 8

A Short Sale Synopsis

Considering the current state of today’s real estate market, short sales are going  to become common occurrence. Being familiar with them and the process of achieving them is going  to be an important benefit  to those in the industry.

A mortgage servicer may be willing  to pursue an arrangement of this kind in a foreclosure situation, provided the sale of the property has not been completed. Even FHA and VA servicers will often consider a short sale, provided they can comply with the insurers’ or guarantors’ guidelines.

When listing a property where a review of the seller’s financial circumstances reveals that a short sale may be necessary, a market analysis will further help  to determine if the seller will need  to bring funds  to closing. If this is the case, and those funds are not available  to your seller, then process of requesting a short sale should begin.

Your listing agreement should have a cancellation clause in the event you cannot complete a short sale arrangement with the mortgage servicer. An example of such would be “Seller may cancel this agreement prior  to the ending date of the listing period without advance notice  to broker, and without payment of a commission or other consideration, if the property is conveyed  to the mortgage insurer or the mortgage holder”. In addition, the agreement should be subject  to the lien holder’s approval of the short sale.

The seller will need  to provide the lender with financial information  to prove that the seller does not have the ability or the assets  to bring funds  to the table. This typically includes copies of recent pay stubs, federal income tax returns, a financial hardship letter, a preliminary HUD statement, and a copy of the contract. (Occasionally the lender will start the process before the contract stage. In this case a market analysis will be required.) In addition, some lenders may require reviewing a copy of the appraisal. They are looking  to verity that the value truly is not there.

When there is a second mortgage on the property, the process becomes a little more difficult. The first lien holder has the ability  to wipe out the second mortgage debt in the foreclosure, and therefore may be reluctant  to give up a portion of their payoff so that the second mortgage lien holder can also receive funds.

There is a motivating factor for mortgage servicers and lenders  to participate in a short sale. A foreclosed loan can reflect negatively on their history, and their standing with FNMA and others. Given the choice, they often would rather work out a short sale, taking less on the payoff and avoiding the negative effects of a foreclosure.

According  to HUD, short sales account for approximately 50% if all pre-foreclosure arrangements with conventional loans. Since these types of lenders are more familiar with the process, it tends  to be the preferable option. The requirements are not as stringent as FHA may be. All parties are involved in the approval, including FNMA, Freddie Mac and PMI.

FHA insured mortgages have additional basic guidelines. They include:

  • Payments must be at least 2 months behind

  • Property must be owner occupied

  • The reason for the default must be unavoidable, involuntary, or beyond the homeowners control

  • The house must appraise for at least 70% of the unpaid principal balance

  • The contract price must be at least 95% of HUD’s appraised value

  • The net amount  to the lender after all closing expenses must be at least 87% of HUD’s appraised value

  • There may be a pre-foreclosure sale incentive of $1,000.00

 VA guaranteed mortgages do not have set guidelines. A review will be conducted  to determine which situation will be more advantageous  to them, the short sale or foreclosure.

 It could take as much as sixty days for a short sale request  to be processed. Be sure  to allow for that time period on the contract. And, since you are working with a seller in financial difficulty, a preliminary title search would be recommended. If there are additional liens that will need  to be paid at closing, the approval of the short sale could be compromised.

The mortgage servicers will allow real estate commissions  to be paid, but often will require that the percentage  to be reduced  to 5% of the purchase price. And, of course, it is important  to remember that the seller will not be receiving any proceeds from the sale as the lender will require that 100% be given  to them for the payoff.

The IRS will be advised that a short sale has occurred. There may be additional tax liability for the seller, and they often are not aware of this possibility. In addition, some loan servicers may place a deficiency judgment against them for the unpaid balance. It is important  to inquire as  to this possibility when pursuing a short sale.

The impact the seller’s credit is lessened by a short sale. The mortgage will show as satisfied, but not completely paid out. A foreclosure is far more damaging.

Coordinating and successfully achieving a short sale can be time consuming and difficult. Having the knowledge  to do so will be a valuable asset for any agent.

Future Home Realty, Inc.
Tom Scaglione, ePRO, SFR, REALTOR
Direct: 813-310-8200 <<< Click


Mar 19

Short Sale Intro… 8-Part Series…

Saving your Home…

First part of the series deals with saving your home…

Learn About Your Options

Making Home Affordable Offers Solutions
Doing a Short Sale?… Second part of the series deals with doing a short sale…

Are you upside down in your home?

We can help… We do successful Short Sales…

There is no cost to you. My team is standing by to help you avoid foreclosure, so contact us now.

Note: some lenders are paying incentives to sellers & waving all deficiencies in addition to forgiving mortgage liens.


Take a look at my 8 Part Short Sale Blog Series on either saving your home or doing a short sale on your home.

There Is Help! “Watch this Making Home Affordable Offers Solutions”
Future Home Realty, Inc.
Tom Scaglione, ePRO, SFR, REALTOR
Direct: 813-310-8200 <<< Click



Mar 19

Short Sale Info Part 7


No Equity?

You May Qualify for a Short Sale!

We Can Sell Your House NOW!
Your Commission and Closing Costs
Are Paid For By Your Lender.

Ask Us How?

A short sale is a special transaction that allows you to sell your home – even when your mortgage debt is higher than the value of your home. We are professionally trained real estate agents who have been specifically trained to work with your current lenders so you can sell the property and get out from under this burden. Best of all, our commission and your closing costs will be paid by the bank, so you won’t have any out-of-pocket expense!


 Your Graceful Exit “Watch this Making Home Affordable Offers Solutions”

Future Home Realty, Inc.
Tom Scaglione, ePRO, SFR, REALTOR
PH: 813-310-8200 <<< Click


Mar 17

Short Sale Info Part 6

Need to Leave Your Home?

 If the cost of homeownership has become too much to bear, the MHA Home Affordable Foreclosure Alternatives Program® (HAFA) allows you to transition out of your home and avoid foreclosure with $10,000 in relocation assistance and peace of mind.

“In many cases, [a short sale] is a dignified exit strategy where the borrower can sell the home and avoid the negative impact of foreclosure on their credit report and return to a better financial position.”

Home Affordable Foreclosure Alternatives (HAFA) <<< Click

 If you can’t afford your mortgage payment and it’s time for you to transition to more affordable housing, this program is designed for you.

 Housing Finance Agency Innovation Fund for the Hardest Hit Housing Markets <<< Click

The U.S. Treasury’s Hardest Hit Fund provides more than $7.6 billion in aid for homeowners in states hit hardest by the economic crisis.

Future Home Realty, Inc.
Tom Scaglione, ePRO, SFR, REALTOR
PH: 813-310-8200 <<< Click


Mar 16

Short Sale Info Part 5

So, You’re in a HAMP Modification. Now What?

For simply honoring your commitment to pay, you could benefit from a total of $10,000 in principal reduction.

To fully understand the terms of your modification, refer to your written agreement and watch for notices from your mortgage company.


Mar 12

What’s My Home Worth ~ Free Report

Tom Scaglione, ePRO, SFR, REALTOR
Future Home Realty, Inc.
Cell: 813-310-8200

Mar 12

Mobile Real Estate Solution

My Mobile Website Works on:

 Windows OS — Apple OS — Android OS — Chrome OS — Lynx OS — Unix OS

 — or any –

 Future OS that uses an internet compatible Browser — No App to download… Just a bookmark!


Mar 12

Congress Considering Extending Tax Relief on Short Sales

Legislation to Extend Tax Relief to Distressed Homeowners Currently in House, Senate Committees

Congressman Tom Reed (R-New York) introduced the Mortgage Forgiveness Tax Relief Act of 2015 (H.R. 1002) on February 13, and that bill is now being heard in the House Committee on Ways and Means. Two weeks later, Senators Debbie Stabenow (D-Michigan) and Dean Heller (R-Nevada) introduced a similar bill (S. 608), which is currently in the Senate Banking Committee. Both bills would extend relief to homeowners on forgiven mortgage debt – the remaining mortgage balance when a borrower sells a home in a short sale to avoid foreclosure. »READ MORE <<< Click

Shared By:

Tom Scaglione, ePRO, SFR, REALTOR
Future Home Realty, Inc.



Mar 12

Short Sale Info Part 4

New Public Service Ads Urge Homeowners to Seek Mortgage Help

Treasury and HUD, in collaboration with the Ad Council, launched a new series of PSAs to raise awareness of the free federal resources still available through Making Home Affordable. These new PSAs – themed “This is Why” – recognize the challenges struggling homeowners face and encourage them to be more proactive about getting help.

Watch the Videos <<<Click <<<Click


Shared By:

Tom Scaglione, ePRO, SFR, REALTOR
Future Home Realty, Inc.

Mar 06

Short Sale Info Part 3

Act now. Don’t delay.

Making Home Affordable has real help to offer, but you must contact your mortgage company or a housing expert to take action. The sooner you do, the sooner you can get on the road to financial recovery. Not taking action can only make things worse. Remember, many Americans have taken the first step towards modifying or refinancing their mortgages, and so should you if you are having trouble making your mortgage payments.

Start now by viewing this instructional video <<<Click

Request for Home Affordable Modification <<<Click
Speak With an Approved Housing Expert <<<Click
Contact Your Mortgage Servicer <<<Click <<<Click


Shared By:

Tom Scaglione, ePRO, SFR, REALTOR
Future Home Realty, Inc.

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