Is 2012 the year of the Short Sale?

Remember when the real estate market started cooling in the second half of 2005?  It seems like just yesterday...  In reality, it was 7 years ago.

In 2006, no one knew what the real estate values would do except  that they were declining.  It wasn't until the second half of 2008 when the banks announced that they were really in trouble that the cat was out of the bag.  Serious declines in home values had occurred overnight it seemed.

  Housing inventory was piling up, homes were being abandoned, sold on the courthouse steps, and some short sales were happening.  Many realtors did not want to participate in the short sale transactions due to legal liability and their experience with the banks in the previous housing downturn  (the late 80's and early 90's).  Nevertheless, the short sale has emerged as a viable and cost effective way for the distressed homeowner to release their real estate holding(s).

A short sale is defined as the sale of a property for less money than what is owed to the banks on that property.  Banks typically make 20% less on the sale of a foreclosed property than on a short sale property.  This is one of the main reasons that the banks are now willing to do more short sales.

There are advantages to the defaulting homeowner as well.  The homeowner usually stays in the home (rent free) until the short sale is complete and sometimes is given a settlement by the bank to pay for their imminent move.  They, in turn, take care of the property while the short sale is being negotiated.  This is good news for the bank since they are not in the business to be caretakers of real estate.   Short sales are not as damaging to one's credit (in most cases--if negotiated properly) as a foreclosure.

If you are a buyer or distressed homeowner interested in the short sale process give me a call today, I can point you in the right direction for advice on the process.

                                                         Carla 
                                                    703-577-4960
                                                                 brkslong@aol.com

ps all photos are a courtesy of http://www.freedigitalphotos.net