"Short sale" is a compromise for the better!
The foreclosure situation in the 9 county San Francisco Bay area is as worse as it is elsewhere. The distressed home owners are amazed. But there is a short-cut to come out of the melee with some dignity – instead of forfeiting their homes to full-fledged foreclosure and eviction.
It is the “short-sale” route which helps both the home owner and lender. This way, homes can be sold to interested buyers, with the consent of the mortgage banks and lenders of course, to a mutually agreed price. This may not be the real asking price of the seller, or in other words a distressed sale for price lesser than the assessed value of the property.
But it acts like a catalyst for the buyer to get profits and the short sale is becoming more popular now. Earlier the banks and lenders were reluctant for obvious reasons to agree for this. They may not get the whole amount of the mortgage loan back. They will have to “forgive” the difference between the loan amount and the short sale price.
As such the consent for short sales was not forthcoming easily. It took weeks to months for the banks to give their consent for the short sale. But prudence prevailed over ambition. Instead of going through the foreclosure process which would entail expenses and delay, short sale was a better proposition for both the lender and the borrower.
Short sale is beneficial far more in that it avoids vacant premises after foreclosure (leading to crimes); the cost for upkeep and maintenance of the property concerned, virtual good money after the bad money for the banks; the home owner scraps through without a foreclosure to ruin his or her credit history and finally the time taken for disposal of the property is considerably reduced.
Short sales will be order of the day in the near future because of the advantages derived by one and all – the home owner; the bank or mortgage lender and the buyer.
