Article on 10 Common Myths Short Sale vs Foreclosure
In my real estate trainings, we hear so often about how as much as 7 out of 10 homeowners could have used a short sale as a means to avoid foreclosure. I always find that interesting especially since the average consumer Googles practically everything nowadays when it comes to anything real estate. My friends at KCM wrote this blog post, and I think the article as well as the comments are worth reading. In my opinion, there are three distinct advantages that a homeowner receives from a short sale vs a foreclosure:
- You get the opportunity to see the bank's cards. That means you have the chance to see the terms they are willing to accept. And there still might be room for negotiating. For the homeowners that we've helped, we don't just give in to the initial terms of the short sale approval, unless they are really, really favorable.
- You remain in control. Even if you decide to put your home on the market and go through the short sale process, if you don't like the bank's terms, you can cancel the sale. There is no penalty for cancelling your sales contract, and no penalty for cancelling your listing agreement.
- It's the only option that really gives you the opportunity to walk away. Like the first point in the article, some homeowners believe that 'letting the home go' is the best way to start over. But with the short sale, they bank may waive the full deficiency, agree to accept the money from the short sale as payment in full, and you may not have to pay taxes on the deficiency amount.
Click here for the full article.