Another RELS Short Sale Seller BUYS a new home the same week of Short Selling their Old Upside Down Home
The cork was popped at the Real Estate Legal Services conference room again today when two very conscientious clients, husband and wife, both defense contractors who need to maintain a high credit rating for their respective security clearances, were able to jettison their upside down home in a short sale and simultaneously close with a new mortgage on a replacement home. They could not count the number of loan officers, realtors and short sale experts who told them that it could not be done. “You will be a strategic short seller, not a true hardship short seller” they were told. In fact they did have genuine and legitimate needs to purchase a home that would accommodate taking in an elderly and disabled parent. But the key to their success was assembling a team with experience and Know-how, staying current on all debt obligations, including their short sale mortgage, and maintaining the highest possible credit rating throughout the process. The elated homeowners are planning to film testimonials for their realtor, Kala DiCiero, their loan officer, Jim Bucher, and RELS. They felt like they were able to win a chess match by having great coaching to remain two or three moves ahead in the match. They never lost sight of the big picture.
All of which is to say, do not assume that the things your heard about short sales 2 or 3 years ago hold true today. The distinction between short selling for hardship and for strategic financial benefit is often downplayed as a factor in short sale approval and can be overcome by thoughtful presentation of the borrowers financial condition and needs. That is where RELS is often the crucial advisor in the short sale process – with RELS guidance, these homeowners redrafted their hardship letter “20 times”.
Another Urban Myth – Short Sales always destroy your credit. Failing to make timely mortgage payments may leave you with no credit to destroy! These homeowners still had 800+ credit scores at the time of their short sale. Future reports to Credit Bureaus by their Short Sale lender may well cause a temporary, but less than catastrophic, drop in rating. But conscientious repair should restore them in under 18 months according to lenders these borrowers consulted and other credit rating experts.
Urban Myth #3: Short Sales take at least 90 days. These homeowners were able to close on the sale of their upside down home and purchase of a new home in 60 days. More good news on that front should begin to take effect next month: “the Federal Housing Finance Agency, which regulates Fannie Mae and Freddie Mac, will require both agencies to give short-sale buyers a final decision within 60 days.” This from the New York Times, with additional analysis on more typical short sale time requirements and credit damage. Please find the entire article at http://www.nytimes.com/2012/05/27/realestate/mortgages-speeding-up-short-sales.html?_r=1