How to Sell Your Home Lower Than the Payoff

Video Transcript

"Hello my name is Alicia Lowther, licensed real estate professional with Realty Executives discussing how to sell your home lower than the payoff. This is common place today because of declining home values. Many people are finding themselves in a situation where they must sell their home, but the amount owed is more than the offer on the table. Maybe you've received a promotion and had to transfer as result of that;. Congratulations, but now be prepared to bring money to the table. To close on that deal you will have to come up with closing cost, commissions of those who're involved, and the difference between the amount of the home is purchased for and what is owed. Another situation that is becoming very common place is what is termed in the industry as short sales. This means that you're asking the bank to accept less than the amount owed. These are very common when there are hardships such as; medical expenses, job loss, divorce. Real estate agents have become very familiar with these and can assist you with the process as can a real estate attorney. If you decide to pursue this on your own the first thing that you'd want to do is make contact with your lender. They might offer you some loan modification programs, and just explain the situation if you do need to go ahead and proceed with the short sale ask them for a short sale package. When you call the lender you're going to ask for the short sale department or loss mitigation department, explain your situation, ask for a short sale package. The short sale package will include all of the items that they're going to need to begin the process. Some will not talk to you or send this until you have a contract, but at least you can get the ball rolling and if they do send the short sale package you can begin gathering the information that they need. Now remember the lender is not obligated to approve the short sale. It is better on your, well a short sale and a foreclosure both effect your credit. However with the short sale you are able to buy after two years whereas with the foreclosure it will be longer probably seven years before you can purchase another home. Again I recommend that you speak with a real estate agent, a real estate attorney, and an accountant because there could be tax consequences. My name is Alicia Lowther, licensed real estate professional with Realty Executives discussing how to sell your home lower than the payoff."