BASIC information on SHORT SALE:

This is a process when your Mortgage Company/Bank agrees to sell the home less than what is owed to them. As an alternative to the expensive and time-consuming process of foreclosure. Each Lender has their own set of processes, which they decide whether or not to accept a short sale. Each Lender also has their own requirements for a SHORT SALE.

 

BASIC information on FORECLOSURE:

First, the Lender files of a Notice of Default (NOD) if a payment had been missed. A certain amount of time lapses before the homeowner is able to reinstate the property. In that case the loan will be brought to current status. If the Default is not corrected, the Lender starts the Foreclosure process and takes back the property. The property then goes to a Trustee Sale, where the property will be auctioned off to the highest bidder. In most cases, the winning bidder will need a 5% deposit check upfront and then have 24 hours to provide the rest of the purchase price in cash. Usually the auction price opening bid will include the outstanding balance, interest accrued and additional fees, - such as Attorney fees, association fees. If there is no higher bid than the opening bid, the property will be purchased by the attorney conducting the sale for the Lender. If this happens, and the opening bid is not met, the property is deemed as REO. Usually this happens when the property is worth less than the total amount owed. All other lien - junior lien, property taxes will be wiped out. When you purchase this type of property - REO - the property will have a clean title.

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