HICKSVILLE, N.Y., Oct. 22, 2019 /PRNewswire/ -- By definition, a short sale is a method of selling one's home when they can no longer make mortgage payments, specifically for less than what's owed. There are numerous reasons why one may experience financial hardship, including illness, physical injury, divorce, or a change in employment. However, there are numerous aspects to a short sale that differentiate it from a foreclosure. Long Island real estate attorney, Markotsis & Lieberman P.C., discusses the short sale process for buyers.
Not every short sale will be approved, which is why it's important for property to have a certain level of value. The lender will make a determination as to whether the appraised value of the property warrants accepting less than what is due on the mortgage.
Once the value of one's property is determined, the owner must complete an application with their bank. This is another area of the short sale process that isn't guaranteed, especially among banks that receive numerous applications, but it's an important step to take all the same. Selling one's home or apartment can be a stressful task, so streamlining the process as much as possible is vital. Filling out an application with one's bank will accomplish this. Remember, however, that the bank has the final say as to whether to accept a short sale and may not let you know for sure for some time after the process has begun.
Next, a property owner must complete a hardship letter. In general terms, a hardship letter is a document detailing why the owner in question is unable to make their mortgage payments. A hardship letter must describe an owner's financial situation with as much detail as possible, in addition to any recent changes that have been seen in the real estate market. The best hardship letters are written with a professional tone, clearly explaining the reasons why one's mortgage has been defaulted on. From there, the letter is left to the bank's approval.
For property owners that are considering short sales, there are a few advantages they offer. One of the most notable is the fact that the property owner doesn't have to concern themselves with any notable fees as would be incurred in a foreclosure. Furthermore, a short sale won't negatively impact their credit score as a foreclosure would, which is important if the individual's financial situation approves down the road. They may want to rent apartment space or even purchase a new home; a solid credit score will be needed regardless.
About Markotsis & Lieberman, Esq.: Markotsis & Lieberman, P.C. Real Estate Lawyer is a general practice law firm. Practice areas include real estate, litigation (commercial and civil), business formations, agreements and transactions, and wills, trusts and estates. Our team of seasoned attorneys are here to guide you through every step of the legal process providing personalized attention to every client. When you're facing a complicated legal situation, our team of legal experts is there to fight for your rights.