In today’s complex real estate market, many lenders are offering homeowners some alternatives to a foreclosure. One of the most common foreclosure alternatives is referred to a as a “short sale”. A short sale occurs when the homeowner owes more to the lender than the home is worth. In a short sale, the homeowner asks the lender to accept less than the full amount owed on the promissory note. In other words, the payoff to the lender is “short”. If the lender agrees, the homeowner is able to sell their home and not have to bring funds to the closing to pay the bank in full.
If you find the need to sell your home in a Short Sale situation, our attorneys can help guide you through the process.
A successful short sale hinges on working with the right group of people, including both a realtor who has experience handling short sale listings and an attorney with the knowledge and experience to negotiate with the lender. The short sale process involves the homeowner demonstrating to the lender that there is a specific hardship which he or she is now facing that has impacted his or her ability to pay or continue to pay their mortgage. In order to support this hardship, most banks require certain documentation such as: two years of tax returns, two months of recent bank statements, two months of paystubs, a list of income and expenses, a hardship letter, listing agreement, specific bank application, offer from a potential Buyer, a draft settlement statement summarizing closing costs, expenses and the proposed amount to be paid to the lender, and a utility bill. Submitting a complete application to the lienholder is the first step to getting a short sale approved. After submitting an application, the bank will assign a specific negotiator and order its own appraisal to verify the fair market value of the property. Thereafter, the detailed negotiation begins with the lender to determine the parameters of the short sale. Some of the items negotiated include: the final price at which the bank will agree to approve the sale (which involves the bank proposing a counteroffer to the prospective buyer for a higher purchase price), whether or not the bank will require the homeowner to sign a promissory note for any deficiency, working to obtain a full release from the deficiency, closing dates and many other details.
Our representation of a homeowner who is attempting to complete a short sale includes not only the actual negotiation and processing of the short sale with the lender, but also includes the negotiation of the purchase and sales agreement with the Buyer, drafting the Deed and a Power of Attorney, and attending the closing. Simmons & Schiavo does not charge any upfront fee and we get paid only if the property sells.
Contact our real estate attorneys to discuss if a Short Sale scenario is appropriate for you.
Our law offices are located in Malden, Massachusetts and we serve clients throughout Norfolk County, Middlesex County and Essex County, Massachusetts. If you have a question concerning any of our areas of expertise or are in need of legal counsel, please contact our firm. We offer a no-cost initial consultation with an experienced attorney to assess your particular legal situation.We also offer legal services in Spanish and Italian.
The Greater Boston Home Short Sale attorneys at Simmons & Schiavo concentrate in real estate matters and serve the Greater Boston and Boston’s North Shore region including the communities of Everett, Revere, Chelsea, Somerville, Cambridge, Medford, Arlington, Winchester, Woburn, Burlington, Stoneham, Melrose, Wakefield, Saugus, Lynn, Peabody, Salem, Marblehead, Swampscott, Norfolk County, Middlesex County and Essex County, Massachusetts.