Conditions to qualify for the short sale:
- Under Water. To qualify for a short sale, the property's value must fall below the outstanding mortgage balance (including all fees and penalties). The homeowner can commission a formal appraisal to determine the property's market value. Thus, if the homeowner took out a $200,000 mortgage and the appraised value of the property is $150,000, then the house is considered "under water" and the lender will likely agree to a short sale.
- Financial Hardship. The homeowner must prove financial hardship and demonstrate this by writing a hardship letter to the lender. Financial hardship must also be long-term, meaning the homeowner will not likely recover soon after the sale has been completed.
- Hardship reasons: Job Loss, Mortgage Adjustment, Reduced Income, Illness, Divorce and Separation, Business Failure, Too Much Debt, Damage to Property, Death of the Wage Earner, Inheritance, Job Relocation, Military Service, Incarceration.
Click on the links to verify if your mortgage is owned by Fannie Mae or Freddie Mac.
The seller's short sale package will most likely consist of:
- Letter of authorization, which lets your agent speak to the bank.
- HUD-1 or preliminary net sheet
- Completed financial statement
- Seller's hardship letter
- 2 years of tax returns
- 2 years of W-2s
- Recent payroll stubs
- Last 2 months of bank statements
- Comparative market analysis or list of recent comparable sales
Anyone who is considering selling a home and has bought in the recent past years faces the real possibility losing money on the sale.
1. Sell at a loss and make up the difference
2. Rent the property out.
3. Short sale. (if qualify)
The thought of losing money is never pleasant but unfortunately is part of today’s Real Estate reality. As a homeowner, you can rent the home and not sell for a loss. And it’s tough decision to make: is renting the home really the best move or should you sell the asset that is working against you?
Enter your address into "Find Another address?" box and click on arrow to get a rent estimate for your house.
American Apartment Owners Association (AAOA) offers landlords help for rental property management including credit reports, criminal background checks and eviction checks. Get landlord forms, rental application forms, lease agreements, eviction notice, lease options and more landlord documents online.
I can help you rent your house and buy another one.
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