Tip 22-2012: Advantages of Short Sale vs. Foreclosure

Charlottesville Real Estate

Tip 22-2012:  Advantages of Short Sale vs. Foreclosure Is it better for the owner of an upside down property to participate in a short sale, or to simply walk away with the lender ultimately having to foreclose?  The answer in almost all circumstances is "Do a Short Sale." The advantages of a Short Sale are:  A short sale has less of a negative effect on the Borrower's credit score than a foreclosure. A foreclosure will affect the Borrower's ability to buy another house longer than a short sale. With a short sale, the Borrower should be able to remain in the house until the lender accepts the short sale (instead of moving out and possibly paying rent elsewhere.) In a short sale, more and more lenders are allowing the Seller a relocation allowance. With a short sale, any deficiency can usually be negotiated away as part of the approval.  With a foreclosure, the lender will usually create a deficiency by buying the property for less than the debt owed. Any Second Deed of Trust will not be paid anything with a foreclosure, while with a short sale, the second lender will receive some money and will probably negotiate a waiver of any deficiency. Finally, a short sale is simply better for the real estate community, and especially for the specific neighborhood than a foreclosure. Any foreclosure resulting in an empty boarded up house is never good for anyone.   Although we know short sales can be very difficult to complete, the advantages far outweigh a foreclosure.    Contact me at 434-951-0858 or Tucker@TGBLaw.com if you have questions, or visit our blog below for previous tips.  Thank you for allowing us to send you this email.     Please share this tip on your social media sites (buttons above.)         William D. Tucker, III  Tucker Griffin Barnes P.C.   Pinterest Gallery - Firm Videos   Charlottesville, VA 434-973-7474 | Lake Monticello (Palmyra, VA) 434-589-3636          Forward to a Friend      Join our Mailing Lists      SafeUnsubscribe

Tip 1-2008: Foreclosure Contracts

Regarding foreclosure contracts where the foreclosure lender is the Seller:

Make sure that the contract states that Purchasers have the option of choosing their own attorney. Recently, our Real Estate Department discovered that many lenders have a clause in their sales contracts requiring Purchasers to use the foreclosure lender-selected attorney for their closings. In a foreclosure situation, I find it best for each party to select his own attorney.

If you should have any questions, please feel free to call me at my direct number 434.951.0858 or my cell number 434.981.1946 or email me at Tucker@TGBlaw.com.