Falling behind on your mortgage and facing the possibility of losing your home or business to foreclosure can be highly stressful. Fortunately for struggling homeowners, there are ways to avoid foreclosure and find a solution to behind mortgage payments. An experienced Elgin real estate attorney can evaluate your situation and determine your legal options. One legal option that has helped many property owners is called a short sale.
What Is A Short Sale?
Simply put, a short sale is the sale of real estate for less than the balance owed to the mortgage lender. This can especially help property owners whose value of the property has plummeted significantly below the loan amount. Many mortgage lenders are willing to work with property owners to arrange a short sale as they can often still receive more for the property than they would in a foreclosure sale. Arranging a short sale is also more proactive for the property owners rather than simply waiting around for the lender to foreclose on the property. One additional point to consider is that many times a home owner may qualify for relocation assistance. This is money (usually up to $10,000.00) that is provided through a government program and does not cost the banks any money.
Effects Of A Short Sale
While a short sale may not destroy a credit score as much as a foreclosure or bankruptcy can, the short sale is still considered to be an account that was not fully satisfied and paid as agreed. Since you are agreeing with the lender to pay less than you owe on the mortgage, the short sale will still negatively affect your credit score. However, once the mortgage is paid off, it will free up funds to contribute to other debts to help bring back up your credit score.
If you are considering to pursue a short sale, it is important to discuss your situation with an experienced real estate lawyer. A short sale is a contract and too many lenders try to include unfair terms that may not be readily apparent to the average property owner. For example, a lender may release the lien on the property, however, they may also retain the right to collect on the deficiency amount, which is the difference between the amount owed and the amount paid. As soon as the house is sold, the lender may try to come after you for the rest of the unpaid debt.
Additionally, short sales take time as you must be able to sell your property for a short sale to work. However, this can be helpful if you are trying to stay living and/or working in the property for as long as possible.
Contact An Experienced Elgin, Illinois Short Sale Attorney Today
Short sales can help both residential and commercial property owners in Illinois mitigate losses and avoid the foreclosure process. At the Jackson Abdalla Law Group, our short sale attorneys have helped property owners in and around Elgin, St. Charles, Streamwood, Bartlett, Carpentersville, and surrounding areas. Even if a short sale is not the right option for you, we can help you find another option that can help you regain control of your finances. Please call our office today at 773-550-3853 to schedule a free consultation.