New Bern-Havelock NC Short Sales

Realtor Steve Tyson

If you would like us to send you all the short sales currently for sale in the New Bern and Havelock area, send me an email at

SteveTyson@ncmove.com

The Short Sale Process

First of all, what is a short sale? A short sale occurs when a home is sold and there is not enough proceeds left from the sale to pay the lender back all that is owed on the note.

While some short sales occur because the owner is behind on the mortgage payments, most occur because

• The owner must sell their property.

• Market values have decreased since they bought their property.

• The property value no longer exceeds the amount of debt on the property.

In negotiating short sale issues, you should understand that the mortgage servicer who collects your mortgage payment may not be the party to who you need to the talking with. The parties with a vested interest in your home are the note holder and the mortgage insurer, if their is one. It will be one of them that will have the final say as to what they will accept for payment if it is less than what is owed on the property. Your mortgage servicer, the person you make your payments to, can tell you who you need to contact to discuss the possibility of a short sale.

Before a lender or loan insurer will decide whether they will consider a short sale, loan modification, repayment plan, or whether a foreclosure is the best recourse for them the following factors are often taken into consideration.

• Loan Status: Usually a loan must be in default or default must be imminent to induce a lender to accept less than the amounts due under the note. However, in some situations, such as a declining market with a 100% loan, or if the property is not worth what is owed may be sufficient to induce a lender to a short sale.

• Hardship: The property owner will be required to demonstrate that there are circumstances beyond their control which impacted their ability to make the scheduled payments. The circumstances may be involuntary loss of employment, extended illness, divorce, or escalating loan costs due to an adjustable rate mortgage.

• Financial Status: The lender may, in addition to verifying the owners income, require documentation of the owners assets and liabilities to determine whether the owner has other resources from which to pay the loan before allowing a short sale.

• Loan Fraud: If the loan goes into default within the first 2 years the lender may audit the documents and make a determination if any fraud was involved by the owner in obtaining the loan.

• Property Value: The lender will require a current property appraisal in order to determine the fair market value of the home.

How does a second mortgage affect a potential Short Sale?

If you have a second mortgage on your home it may not be possible to arrange a Short Sale. The seller will not be able to convey clear title to the property until the first and second lien holder has been paid in full. If you cannot work with both lien holders the short sale will not work.

 We hope that this web page will give you some insight about the short sale process. If you have any additional questions about this process please feel free to call me at 252 514 9157 or just send us an email.

SteveTyson@ncmove.com