Foreclosure Is Not The Answer!
This website has been designed to provide Denver and Colorado homeowners with information about Short Sales and Foreclosure.
You may have discovered that you owe more than your home is worth. Home values are determined by actual comparable sales within the last six months. In some neighborhoods, lenders are requiring appraisers only use sales within the last three months. If your neighborhood is riddled with foreclosures, your property value will likely suffer. This creates a vicious cycle for the homeowner. As income ends due to job loss and gas and food prices rise, your bank account continues to fade. You may find it difficult or impossible to make your mortgage payment and have no ability to refinance or get a loan modification. We are in tough economic times. You may feel that you have failed and are looking for a way out.
The banks got their bailout but what do you do?
Foreclosure is not the solution! Don’t shy away and just wait for your home to be foreclosed upon. Depending on the bank, a foreclosure can take years, several months or can be as fast as 120 days! If you are behind on mortgage payments, you should familiarize yourself with the Foreclosure Timeline. Banks don't want your home any more than you want to lose your home. Banks are overwhelmed with foreclosures.
As foreclosures increase in the Denver Metro area, home values have taken a nose dive. The media does not help as they continue to tell the public we are in a doom and gloom situation. Not every neighborhood or homeowner fits neatly in the descriptions provided in daily news reports.
A short sale could be the answer. A short sale agreement is between the homeowner and the lender (also called the lien holder, mortgage holder, note holder or bank), to accept an offer for less than the total amount owed on the home. The "deficiency" is the difference between the amount owed and what the bank collects at the sale of the home.
You don't have to be behind on your mortgage to request a short sale. You must only demonstrate that your house is not worth what you owe and you have a financial hardship.
Short Sale vs. Foreclosure
Don't be misled that a short sale is the same as a foreclosure. It's simply not. In a foreclosure, the homeowner falls several months behind on their payments. After unsuccessful attempts by the lender to resolve the issue, the homeowner is declared in default by a judge and the bank repossesses the home and subsequently sells it. In almost all cases the bank pursues the homeowner for the deficiency.
Just ask someone who has gone through a foreclosure and they will likely tell you they were forced to file bankruptcy in order to get out of paying the deficiency.
With a short sale, our professional negotiator works with your lender to accept a payoff and consider the debt "settled". All banks are not alike but most follow the same short sale process.
A short sale is not a magic cure. It is a complex and time consuming process. Although, in most cases, it can leave you much better off than the alternatives of foreclosure and bankruptcy.
A short sale is not some mystical solution that only an elite few know about. It is something which very few homeowners are successful at by themselves. It is one of the most difficult real estate transactions that most Realtors don’t do so well.
A Real Estate agent is trained to market a home to find a buyer for the seller. An experienced Realtor knows how to negotiate the best price and terms for their seller and advocates in their best interest. Once the seller is under contract, the real estate agent manages the seller’s side of the transaction and all the details that bring the sale to a close. Conversely, the buyer’s agent negotiates to get the best price and terms for the buyer and advocates in their best interest. The Buyer’s agent then manages the buyer’s side of the transaction and all the details till the closing.
Negotiating with the bank is completely different. The negotiator must have specialized skills that require focused attention, patience and significant time. A negotiator must be experienced with hundreds of banks and must work full time to get the job done. Many homeowners have first and second mortgages, making negotiations even more difficult. A top producing real estate agent does not have the time to negotiate and conduct their Real Estate business and also negotiate full time with banks. Demands by clients on a Realtor are non-stop and there are just too many details to divide the agent’s attention.
The best case is a real estate agent that has teamed with a professional short sale negotiator. Now the real estate agent can work within their expertise as the short sale negotiator works with the bank.
Keep in mind, in a short sale the bank must be getting "shorted". The IRS views this “shortage” as a tax deduction for the bank. The reality is, when there is a loss, somebody had income. In this case, the IRS looks to the homeowner. The deficiency written off by the bank can be considered income to the homeowner. New legislation has been approved regarding this debt. Visit the Short Sales for Sellers tab. Of course this is a tax and legal implication that needs the attention of your tax accountant and attorney. Short sales are like the “wild, wild west” right now.
FHA Short Sales are regulated a bit more. We have FHA guidelines which must be followed to the letter by all parties. There are great opportunities for sellers with FHA mortgages to short sale. If the seller works with the bank to get a closing quickly, financial incentives may apply. Government regulations and banking systems are changing daily. Check in with our Blog to get the latest info on the short sale scene.
A Short Sale for Buyers is a great opportunity to get a good solid home at a below market price. Patience is the key here. A buyer must wait for the banks short sale system to work. This could take months! Meanwhile, your earnest money deposit is being held and the banks can dictate terms any way they want. Of course, the buyer doesn’t need to get pushed around by the bank more than they can take. The buyer can always terminate.
The real estate agent that represents the seller, and how they conduct the short sale, is critical to the success of the transaction for both the buyer and seller. Short sale agreements for the most part are consistent. Unfortunately, most banks attach addendums which strip many of the buyer’s rights away. Understanding the bank’s addendum and the short sale process is critical.
You need a seasoned short sale negotiator and an effective
home marketing plan to orchestrate a successful short sale.
We Can Help
Home Source Group is committed to help Denver and Colorado homeowners to delay or avoid foreclosure by negotiating a short sale. We are licensed Real Estate Brokers in Colorado and highly skilled in all phases of negotiation. While our short sale negotiator works with your bank, our marketing team will be underway to sell your home at a price acceptable to your bank. We will attract Buyers looking for short sales. The best part is that all fees are paid by the bank.
This site is not designed to provide information for industry professionals or consumers located outside Colorado. Government regulations and banking trends change daily. While we do keep up to date with these changes, we only provide basic and generic information in this website. For more details, or to address your specific situation, please contact us by phone or use the contact information form.
SHORT SALES ARE OUR SPECIALTY!
We are an A+ Gold Member of the
Better Business Bureau since 1999!
Proudly serving the Denver Metropolitan area
for over 15 years!
Home Source Group
7728 Vance Drive
Arvada, CO 80003
(303) 429-1887
Fax (303) 412-5608
mail@homesourceinfo.com
The Smart Choice!
Cindy Belhumeur, Owner
Gary Belhumeur, Managing Broker
