Since 2008, some homeowners have seen their home’s market value fall below their mortgage balances. Many have found that they now owe tens of thousands of dollars more to the mortgage company than their home is worth. What can you do to protect yourself?
“Short Sale” is a real estate term that has entered our everyday language in recent years. A short sale is done when the market value of the home is less than the amount owed to the mortgage lender. The mortgage lender must agree to take less than they are owed on the house so that the seller give the buyer good title to the house. Here is where things get complicated. The seller makes legal promises and warranties to the buyer, whether the house is sold short or at a profit. This means that the seller can both lose money and be liable to the buyer into the future.
So, what happens after the short sale? [Read more…]