5 Reasons Why You Should Still Short Sell Your California Home Today!

For California home-owners who owe more on their home than the home is currently worth, a short sale is an effective procedure to sell your home and have the deficiency (the remaining debt) wiped-out.  In the past few years, many Californians have short sold their under-water homes, off loaded their mortgage debt, and have even gone on to buy better homes at today’s affordable prices.

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However, in recent months, many real estate professionals have observed a decline in the number of short sales compared to the volume of short sales closed in the last 3 years.  This shift can be attributed to (i) successful modification of many mortgages, (ii) a new trend of increasing property values, and (iii) the large volume of short sales that have already been completed by distressed home-owners.  Notwithstanding this decline in short sales, there are still many homeowners who could and should take advantage of a California short sale.

Below are 5 Reasons to Short Sell Your Home today if you currently owe more debt on your home than your home is worth:

(1)    You Get Rid of an Under-Water House and Get Rid of Your Crippling Mortgage Debt: If you owe more on your house than your house is currently worth, you should consider a short sale.  Even if you have multiple mortgages on your home, a successful short sale in California allows you to sell your home and the remaining mortgage debt is wiped out.  California law currently states that as long as your mortgage lenders agree to the short sale, the remaining mortgage loan balance is wiped out and uncollectable.  In contrast, a foreclosure may still leave you personally liable for a large portion of the mortgage debt on a recourse loan even after the foreclosure is completed.  Because a successful California short sale gets rid of the entire mortgage debt, it is always a prudent option to explore before letting your home go to foreclosure.

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(2)    Your Relocation Allowance could be Substantial: Many mortgage servicers now offer significant financial incentives in the form of Relocation Assistance to home owners who opt to short sell their homes.  Typical relocation assistance offered by mortgage servicers to home-owners can range from $2500 to $45,000. Mortgage servicers are able to offer these substantial relocation allowances to home-owners because mortgage servicers averagely net 25% less proceeds in a foreclosure than in a short sale.

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(3)    You can Avoid Property Tax and Routine Maintenance Expenses:  By short selling your under-water home, you can avoid paying property tax and routine maintenance expenses, such as gardener, utilities, repairs, as soon as the home is sold.

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(4)    You Enjoy a Dignified Exit instead of an Oppressive Foreclosure: Unlike a foreclosure, a short sale allows you to hire a real estate professional of your choice who lists and markets your home for sale and negotiates the short sale with your mortgage servicer.  You control the transaction and the public information disseminated about the sale of your home because the real estate professional works for you. In a short sale, you can also choose to have your home marketed and shown at your convenience.   In contrast, a foreclosure can be very traumatic and oppressive.  In a foreclosure, your default is publicly recorded via a Notice of Default and the foreclosure sale is also publicized via a Notice of Sale.  A very public notice is posted on your front door stating that you are in default on your mortgage and this can be read by your neighbors right before your home is auctioned off publicly.  When going through financial distress, it is definitely beneficial to explore a private and dignified short sale before letting the house go to public foreclosure.

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(5)    You Enjoy Shorter Credit Repair and You Can Buy Your Next Home Faster:  When you sell your home in a short sale, it usually takes an average of 2 years to rehabilitate your credit and be in a position to get a new mortgage loan to buy your next home.  However, if your home is foreclosed, it could take anywhere from 4 to 7 years before you can get a new mortgage to buy a new home.  The impact of a short sale on your credit report rating is much less devastating than a foreclosure.  For instance, the missed payments leading up to a short sale may cost you about 50 points in your credit rating; in contrast, a foreclosure could cost you over 300 points and the foreclosure will remain on your credit report for 7 or more years.

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In sum, if your home is upside-down, and you are experiencing some financial distress and you need relief from the mortgage debt, a short sale allows you to sell your home, get rid of the mortgage debt and deficiency, maybe even score some Relocation Assistance from $2500 to $45,000, and enjoy the “New Beginning” that you so rightly deserve.

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If you are interested in short selling your home, contact Bandele Oguntomilade at 818-825-6996 or Apply Here.   Bandele Oguntomilade is a Short Sale and Foreclosure Resource Specialist, a Certified Residential Specialist and the Broker and Owner of Bogun Realty and Luxury Homes in Woodland Hills, California.  You may visit us at http://www.BogunRealtyAndLuxuryHomes.com.

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We are not engaged in the practice of law nor do we give legal or tax advice. Please seek advice from appropriate legal and tax professionals.

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