SHORT SALE

"THE CONVERSATION"

"Today we will discuss with Diane Shattuck, your Professional and Knowledgeable Realtor,. the definition and consequences of a "Short Sale transaction.,

Question: "Hi Diane!´"  Can you define what a Short Sale is and how this is effecting today´s real estate market?

Answer: A Short Sale is when a buyer offers less than the full mortgage amount for a property listed for sale. If a Lender accepts this contract the action is called a Short Sale.

Banks and Lending institutions operate to make money.  If their customers default on the mortgages, the bank or lending institution cannot make money on these loans because the properties in default eventually become part of the banks inventory.  This action reduces the ability of the Bank or Lending Institution to lend money due to lack of income.  In addition, eventually the maintenance and legal costs involved in foreclosing on these properties also affects their ability to lend money.  The banks or Lending institutions acceptance of a Short Sale allows these financial institutions the freedom of not foreclosing and ultimately reducing their long term loss.

Question: Do all Banks and Lending Institutions accept Short Sales?

Answer: All Banks have a "Loss Mitigation Department that handles requests such as Short Sale.  This department will review the contract of sale and make a decision whether to accept or reject the buyers offer.  If accepted, the house is sold at a price below the full mortgage amount.  Be advised, that their may be Federal tax laws and penalties to the sellers for this transaction.  All sellers should check with their tax authorities and the Federal Government to make sure they are aware of all laws and regulations relating to the Short Sale.

Question: Diane would you advise a seller who is having problems to keep their mortgage current or planning to sell their homes in today´s market to investigate this option with their lender?

Answer: The Short Sale is a viable option to a group of homeowners either having difficulties keeping their loan current or having selling problems in today´s real estate market.  Let me say that a seller should immediately contact their banks or lending institutions at the first sign of monetary troubles to discuss all the options available to help them and the consequences related to each option.

Question:  Is now a good time to buy, or should prospective buyers wait a little longer?.

Answer: Currently the housing market is a buyers market.  The Federal Reserve has just reduced the Prime Interest Rate and mortgage rates have also fallen.  The interest rates on mortgages are now below 6%.   The opportunity to live in the Sunshine state is within everyone´s grasp.  Prospective buyers can call or e-mail me to discuss the purchase of a home, Condo, or Town home on the Space Coast.  If you are considering selling, I am here to assist and guide you and your family in the most important transaction of your life.  Remember my motto is "FAMILY HELPING FAMILY".