Spare Your Credit - Short Sale!

Save your credit, drop your upside down mortgage, and get paid to do it?

Many people feel trapped by their home because they know the value has dropped below the mortgage amount, but they don't want to miss a payment for fear of credit damage.  Most homeowners feel that since they are able to make their payments, they wouldn't qualify for a short sale, nor government incentives.

Recently, a family in the 32828 zip code reached out to us because I helped a friend of theirs and they wanted my opinion on selling their home, due to the fact that relocating to the Carolina's would significantly lessen the amount of travel that the homeowner was required to do for his job.  After meeting with the homeowners, I learned that the seller had an amazing 800 credit score, had never missed a mortgage payment, and had a retirement savings that he was concerned about.

I explained a dark secret to him that banks don't want anyone to know:  most banks will allow you to short sale your property without missing a payment; thus keeping your credit in good standings!  Retirement funds are protected and can't be touched; even liquid cash in bank accounts can be protected easily with a few asset protection techniques.

The seller's agreed to give us a try.  Their beautiful home fortunately sold the first weekend for higher than the list price.  We had multiple offers come in, driving the price up even higher.  My team carefully prepared the short sale package, including the detailed short sale and lender documents as well as the buyer's contract, and we submitted the entire short sale file to the seller's lender on August 10, 2011.  Twenty days later, the short sale lender issued an appoval letter, allowing the seller's to sell their home for $205,000.  The bank forgave $66,470 of debt with NO penalty to the seller.  The best part is that my team was able to get them $3,000 cash at closing towards their moving expenses!

Let's recap:

• Seller never misssed payments and had liquid savings.
• House under contract in less than four days.
• Short sale approved in 20 days.
• Seller received $3,000 in closing.
• Seller's mortgage was paid off in full.
• Seller's credit remained in the high 700's.

We were just glad that we were able to help these wonderful people carry on with their lives, regardless of the bad economy.