BEHIND ON THE MORTGAGE? HELP IS AVAILABLE FOR YOU

As the economic slowdown seems to go on and on forever, more and more homeowners are feeling the pinch of trying to keep up with their monthly payment. As of today, there are 3,838 houses listed for sale in Delaware County. 257 of these are "Short Sales" (about 7%) which means that the sellers have too little equity in the property to pay off the mortgage when they sell.

The bad news is that this trend seems to be increasing. The good news is that help is available and that lenders are willing to work with homeowners and their agents to work out a settlement. More good news (for buyers at least, is that Short Sales can be a chance to buy a house at a significant discount to the market.

Many homeowners feel that there is no choice between keeping up their payments and declaring bankruptcy. Actually, they do have significant leverage with their lenders, for these reasons.

If a homeowner decides to just leave and "Give the house back to the bank", his or her credit rating takes an enormous hit that sticks with them for years. Banks do not like it either, because the foreclosure process is long (14-18 months in PA),it costs them a lot of money and the average foreclosure sells for only 59% of the normal value.

If however, the homeowner approaches the bank and lays out the case for a short sale, the average sale price for that situation is 81% of the normal value. That is 22 percentage points. On a house that is worth $300,000 in today's market, that is a difference of about $66,000 in more money to the bank. Other positives for the lender are that the whole short sale process costs a lot less and it can be done a lot faster. While neither a Short Sale nor a Foreclosure is a good thing for the lender, the Short Sale is a lot less damaging.

Not all situations are candidates for a Short Sale, but a lot of them are. If you think that you might qualify or if you know someone who might, you or they will be relieved to know that help is available that can get you out from under a real bad situation. However, this is not something that you should try on your own. You need the help of a trained and able Realtor to help you through the process.

If you would like to learn more about Short Sales, please send me a confidential email at DelcoRealEstate@Gmail.com or make an equally confidential phone call to me at 484-574-4088.