What are the pros and cons of a short sale for sellers?

| Oct 19, 2020 | Uncategorized

When the economy is in trouble, residential real estate owners in Bronx, New York, may encounter difficulty keeping up with their mortgage payments. As you know, falling behind on these payments can lead to foreclosure proceedings. In most cases, when such proceedings are imminent, it is wise to avoid foreclosure. Unfortunately, you have limited options for avoiding foreclosure. A residential real estate short sale might be your best solution.

In a short sale, homeowners sell their property for less than they owe on their mortgage debt. For this to be the most beneficial for the seller, the mortgage lender agrees to the short sale and forgives the remainder owed on the mortgage. Other benefits of short sales instead of foreclosure include:

  • You can avoid the fees associated with traditional home sales
  • Your credit will take less damage
  • You may be able to acquire a new mortgage in two years instead of seven
  • You will gain peace of mind at having addressed your situation

As with most major life events, a short sale also has a few disadvantages. Examples of these include:

  • You will have to start over to secure a home
  • The process can be complicated and time-consuming
  • You will not make any profit from selling your home
  • A short sale will still affect your credit and your ability to acquire loans

Instead of making an immediate decision about what to do when foreclosure is imminent, it is smarter to give the matter careful thought. Many New York residents also seek professional guidance from a residential real estate attorney. Doing so allows you to explore all options available to you and make well-informed decisions going forward.