We are posting this article to our Blog to help Realtors and Homeowners understand the power of taking advantage of participating in a Short Sale when other cures for default have been exhausted.

There are many ways to lose a home but signing away ownership in a manner that destroys credit, embarrasses the family and strips an owner of dignity is one of the hardest. For owners who can no longer afford to keep mortgage payments current, there are alternatives to bankruptcy or foreclosure proceedings. One of those options is called a "short sale."

When lenders agree to do a short sale in real estate, it means the lender is accepting less than the total amount due. Not all lenders will accept short sales or discounted payoffs, especially if it would make more financial sense to foreclose; moreover, not all sellers nor all properties qualify for short sales. That said, the Major Lenders do not want an excess of homes in their REO (Real Estate Owned) inventory. This inventory cost the Lender more money to forclose and re-sell a home than it would cost them to accept less money than actually owed by the homeowner, in a short sale.

• Obviously a homeowner would like to catch-up on their mortgage payments to prevent or cure a default notice from their Lender.
• Unfortunately, the longer into the default, the more money the homeowner owes the Lender.
• House payments with accruing late payments
• Legal Fees
• Forced Homeowners Insurance (If Homeowner allows lapse of Homeowner insurance)
• These charges are accumlative and many times snowball into more money owed than most homeowners can pay back
• It is to the Homeowner's advantage to immediatelly contact the Loss Mitigation Department within their mortgage company/Lender. This Department is sometimes called "Short Sales".
• It is VERY important that the homeowner realize that their are two very important departments within their Lender; The 1st is the Foreclosure Department, the 2nd is the Loss Mitigation Department.
• The Foreclosure Department has one thing on their mind and that is to foreclose on your client's home as quicky as the law allows.
• The Loss Mitigation Department will work hard with you to assist you in avoiding a forclosure on your client's record. This is the department you want to talk to about Short sales.
• I like to think of these two departments within the same lender as two trains racing toward one another with your client in between, sound scary? You bet it is!
• I would like to mention here that both the person or "Team" that is assigned to your client's forclosure and the person or "Team" from the Loss Mitigation Deparment, assigned to your client's account get a bonus for their respective duties, They win, even if you don't.  

The Lender will require certain paperwork to be filled out and each Lender is different. Your Client will need a seasoned, experienced Realtor to help navigate the Short Sale process. We also recommend that you, the Realtor act in negotiating with your Client's lender. This takes the personal vulnerability out of the transaction and makes the process run more smoothly since the Realtor experienced in Short Sales knows the timelines, paperwork and how to deal with your Client's lender.

Both Jim and Carolyn are experienced and successful with Short Sales. You need to act quickly, as soon as you know that your Client cannot keep up their mortgage payments. You can apply for a short sale before your Client falls behind or after they receive a default notice. The sooner the better, you will need time to get your Client lender's permission to pursue a Short Sale, this takes time, the longer you have to sell the home, the better chance a Short Sale will be successful.

If we can answer any questions on Short Sales or offer you a referral source for those of your clients that are looking to move to Oregon, we would be happy to work with you and them for either investments into Short Sale Properties or to find a good buy and get instant equity on a Short sale property to live in. 

Call Jim: 503-475-7658  or e-mail: james.blaurock@century21.com

Call Carolyn: 503-869-2589  or e-mail: carolyn.blaurock@century21.com

www.SWPortlandShortSales.com