Hey there,
When a home is sold for less than the full amount owed on the mortgage, it is known as a short sale (s). The mortgage lender/bank agrees to take a "short" payoff, which is less than the total value of the loan, in order to simplify the sale. Lenders and banks have strict guidelines on whether properties are eligible for short sales.
The primary benefit of a short sale is that it will allow you to avoid foreclosure and preserve your credit if you find yourself in a situation where you owe more on your house than it is valued and you need to sell. You must wait a minimum of seven years to apply for a mortgage if there is a foreclosure on the credit history. After a short sale, you have two years to repurchase.
Get home loans from leading banks on NoBroker at low-interest rates.Pros and Cons
The pros of a short sale are
Following the sale, you won't have any debt. Your loan will be regarded as "settled" by your lender.
You'll be in a position to prevent foreclosure.
The timelines and your circumstances will be under your control.
Less damage will be done to your credit than in a foreclosure.
As opposed to a foreclosure, you would be able to buy a home sooner.
There won't be any public information about your credit.
The sale may be conducted in private.
The cons of a short sale:
In order to avoid walking away from a foreclosure, you must assume responsibility for the sale of your property.
The approval procedure can take a long time.
Both a short sale and foreclosure may have tax repercussions.
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What Is Short Sale in Real Estate? its pros and cons?
Anas
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2022-11-09T10:49:51+00:00 2022-11-09T10:49:52+00:00Comment
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