Selling a Short Sale in Hillsborough, Pinellas & Pasco Counties
What is a short sale?
When a borrower owes more for a property than the market value of the property, the lender may be willing to take a loss on the loan if the borrower is able to prove financial hardship. In some cases, the lender may require a mortgage payoff amount that is less than the amount owed to facilitate the sale of the property by the borrower.
Short Sales vs. Foreclosures: What are the benefits of a short sale as opposed to a foreclosure?
As a homeowner, one of the main benefits of a short sale is that your credit will not suffer as much damage as it would from a foreclosure. A foreclosure could lower your credit score by over 250 points while a short sale may only affect your credit score by as little as 50 points. In addition, the effect on your credit score for a foreclosure could last more than 7 years while a short sale might only affect it for 18 months or less. You may also be eligible for another mortgage within 2 to 3 years after a short sale, but ineligible for another mortgage for up to 7 years following a foreclosure. Lower deficiency judgments are also given for short sales than foreclosures. A lender may even give up the right to pursue a deficiency judgment against the owner during a short sale.
What documentation is required?
Some of the documents you would require for a short sale include:
- Your bank statements for the last month
- Your tax returns for the last 2 years
- A detailed hardship letter explaining the reason for the short sale request
- Paystubs or a profit and loss statement
- A financial spreadsheet