Short Sale – How To Stop Foreclosure -> Part 3

OK, so far you have learned how to stop foreclosure with two ways, first is by talking to your lender and second by means of selling your home. The third option is called a short sale. Your lender will qualify you for this option if your home was sold for less than your mortgage.

This is especially common in today’s economic disaster market. Many home owners bought their current home for a lot more than it is worth right now and if these are forced to sell their home due to a Florida foreclosure they might qualify for a short sale.

To be approved for pre-foreclosure redeemed you need to negotiate with your mortgage lender. This is usually done through your banks loss mitigation department. If you are approved, just be aware that it will affect your credit score.

If you are approved of a short sale it means you will have to turn over the full proceeds of the sale of your home to your lender. Some lenders will consider this as the full settlement of your debt, meaning you will no longer need to pay any outstanding mortgage rates. However, not all lenders are happy to do this.

Extenuating circumstances will influence whether or not your bank will discount your loan balance. This is usually influenced by two things:

• The economy
• Your financial situation

Banks will also agree to a short sale when they believe that it will result in a smaller financial loss than foreclosing. For you as the home owner, advantages include avoidance of a foreclosure on your credit history and partial control of the monetary deficiency.

A short sale is also faster and much less expensive than a foreclosure procedure. A short sale is nothing more than to negotiate a payoff with lien holders for less than what they are owed.