April 8, 2014
According to NBC News, there are over 22 million homeowners in the United States that currently cannot sell their homes without having to pay deficiencies or come out of pocket to pay closing inventories. While the economy in Washington DC is certainly better than most areas nationwide, there are still distressed property owners who are looking to sell their houses fast in Washington DC, but cannot afford to come out of pocket to pay.
An underwater home can be described as when a mortgage is greater than the value of the house, even if you have a small percentage of equity, it may not be enough to pay the closing costs. If you are considering a short sale, there could be drawbacks that your need to be aware of. For your own protection, all property owners should seek legal advice from a competent real-estate lawyer.
If you are considering the option of a short sale, you should:
Contact the Lender
Get in touch with your financial intermediary and request to speak with the “Loss Mitigation Department” of the bank. It is likely that the bank will be very firm at first and may be hard to deal with, but be direct, to the point and they will loosen up and prepare to deal with your situation.
Preliminary Net Sheet
Your financial intermediary will want to see how much money they are going to net with your offer. Providing them with a Net Sheet with your offer will provide the bank with all the details and numbers they need to see.
Proof of Income and Assets
It is best practice to be open and honest when it comes to your financial situation and disclosed assets. Lenders will request to know if you have items such as money market accounts, negotiable instruments, stocks or bonds, cash or other property or assets of tangible value. Essentially lenders require assurance that the debtor cannot repay any of the debt that it is forgiving.
Copies of Bank Statements
Present your statements to your bank and be advised that if your statements show unaccountable large deposits or withdrawals it’s a good idea to explain each of these line items to the lender.
Purchase Agreement & Listing Agreement
The lender will require a copy of the listing agreement and a fully execute offer accepted by the seller. Be prepared that the bank will most likely negotiate all fees, home protection policy, etc.
When you originally purchased your home, you most definitely did not picture yourself in this situation. Unforeseen circumstances, such as a unemployment, readjusting mortgage rates and illness to name a few examples, can put you in such an undesirable position you never imagined. It is never more important that you look at all your available options, including bankruptcy, foreclosure and the short sale before you select the one that will work best for you.
At Capitol Home Buyers we are LOCAL buyers looking for homes in the DC area and are prepared to make you an offer today on your home. Get in touch with us today for a quote on your home in 24 hours.