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Many sellers are worried about letting others know that they are putting their home on the market as a short sale. However, a short sale just means that the seller owes more on their home than it is worth. That is all the community will know–you are short selling due to owing more on the home than the market will bear.

And, according to recent estimates, these sellers are not alone. One out of seven home owners in the United States are in the exact same situation. Listing a home as short sale is not a badge of shame. It takes a strong person to admit that they need help, and even stronger one to take action as they find a professional who can work with them towards a solution. Just remember, 40% to 60% of the sales in the United States are predicted to be short sales or foreclosures. If you list your home as a short sale, you’re not alone!

We’ve all heard it– “Buyers don’t want to look at short sales! They avoid them!” This myth is quite simply false. Many agents and sellers hear this all the time, even though it is completely untrue. As realtors, we can assure you that we have seen many buyers who are extremely interested in short sales and foreclosures. In fact, many agents are getting calls from buyers who only want to look at short sales and foreclosures. Specifically, international buyers are interested in these properties. 

You may wonder why this is, but the simple fact is that for many people a short sale or foreclosure is synonymous with a good deal. The buyers who are looking at a short sale or foreclosure are simply seeing themselves as smart buyers, people who are getting the most bang for their buck. 

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This is the third installment of our seven part series on short sales and the dangerous myths that surround them. You can see part one here and part two here.  

Many home sellers believe that selling their home as a short sale means they must already be behind on their mortgage. This is not true. However, it is true that some lenders will want you to have missed a payment (be in default) before they will consider a short sale. While this is common in today’s market, it is not as prevalent as it once was. Today, many lenders are just looking for evidence of a verifiable hardship. They just want to see that your monthly cash flow falls short of your expenses or that you have a pending shortfall and insolvency. For instance, a job change or salary change would strong evidence on your side. 

If you meet these requirements (financial hardship, monthly income shortfall, and insolvency) and are in a position where you will soon be unable to afford your mortgage payments, act now! Waiting until you are closer to foreclosure or foreclosure is imminent only means you will have less time left to save yourself and your family. List your home right away with a Realtor, and they’re a good chance you’ll end up being a lot better off then if you wait until last minute. 

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This is our second installment of our seven part series on shorts sales! To read the first one, click here.

Many people have heard that banks don’t really want to do short sales, and they not accepting offers on them. There have been rumors floating around that banks are waiting on bailouts instead of accepting any short sales. This is completely untrue!

The reality is that banks are trying to do avoid foreclosures, more than anything. They will not deny a short sale because they hope of future legislation passing that will pay them for their loss of money. In fact, many banks are aggressively pursuing short sales.

In addition to pursuing short sales, banks are also looking for agents, like a Certified Distressed Property Expert, who understand how to process short sales. For example, Freddie Mac recently held a national training webinar for real estate agents. The goal of this was “eliminating distressed assets through modification or short sale”.

Avoiding foreclosures are the banks’ #1 priority, and a short sale is great way for them to avoid foreclosure. Banks welcome short sales, especially in comparison to the possibilities of foreclosure.

If you’re moving, downsizing, or just replacing items that don’t fit into your home anymore then support our community by donating them to Kitsap County Association of Realtors for the garage sale next Friday.

If you don’t have anything to donate, why not show up and see if there’s anything you’re interested in? One person’s vintage desk can easily become the finishing touch to a perfect office for you.

The first myth is that a short sale never gets approved.

This is simply not true. We are closing three short sales this month alone, so short sales do get approved. However, it is also true that they are a bit more difficult than a “normal” sale and there is a different process with a short sale.

The best thing to do is find an agent that has the Certified Distressed Property Expert (CDPE) designation. The Mike and Sandi Real Estate Team has the CDPE certification. This means that we have taken classes and had comprehensive training in how to help homeowners in crisis, along with processing short sales.

If you’re thinking about buying a short sale, or selling your home as a short sale– choose to go with a CDPE certified agent. It will make the buying or selling process easier for you and your family.

So you’ve bought your home… Now what? It’s likely that the previous residents did not have the same decorating taste as you, and now you’re going to have to decorate your home.

We love innovative companies, and one such company that caught our eye is Authentic Home. If you’ve ever stared at a wall of paint swatches wondering where to even start, then this company is for you! Budgeting is important now, more than ever–and many of us don’t want to hire someone to decorate our home or paint it for us, especially if we think we can save money by doing it ourselves.

The great idea Authentic Home has was to place paint colors into different categories, sorting them all out by a certain mood. So if you never know where to start with paints, then all you have to do is choose a mood and browse through the colors within to find what you like. The paints can be purchased online, or if you want to see all the swatches in a mood you can purchase multiple or single paint palettes. The store offers the moods “elegant”, “serene”, “playful”, “regal”, and “fresh”.

With all the colors offered for painting your home, we thought this one should be featured for it’s user friendliness, innovation, and just plain common sense.

Since we’re out of town at a conference, this will be short and sweet. In our last post we mentioned the current market rates and how that can affect whether or not you’ll want to a buy a home.

This graph illustrates the current market trends, and as you can see, right now really is the one of the best times to purchase a home if it is something you can afford.

Image acquired from Google Images

If your home is too small from your growing family or if you’re considering downsizing since the kids have left, this market is one of the best to consider moving or investing in a new property. A seller with equity has increased buying power because the prices are down on homes and interest rates are low allowing you to afford a nicer home for the same amount of money. Even better? You’ll have more options on your choice of homes. If waterfront, acreage, and a warmer climate were once out of your price range then it is likely they won’t be now! It really is a chance of the lifetime to get a the home of your dreams.

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If this has intrigued you, then the first step to take is to get a market analysis for your home along with a net proceeds document from a realtor. These documents will let you know where you’re at with your home, how much it will sell for and the amount of money you will get from the sale. Then contact a lender to determine your budget and start looking at homes in your price range to see what your money can purchase. This is the best buyer’s market around and with equity in your home you’ll have strong purchasing power.