short sale or foreclosure

Short Sale Or Foreclosure: How Should You Sell Your Home?

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Are you a homeowner struggling to keep up with your mortgage payments?

If it has all become too much for you and you’re considering a short sale or foreclosure, we’re here to help.

In this article, we’ll give you the facts of both so you make the best decision for your situation. Read on to learn how.

What is Short Sale?

While sometimes there’s confusion between short sale or foreclosure, they’re quite different.

When you sell your house on short sale, you’re selling the house for less than what you owe on the mortgage. For example, if you still owe the bank $210,000 but decide to sell for $190,000, you would be selling your house on short sale.

Before you can begin with the short sale process, a few things need to happen. First, you need to get the bank or lender to sign off on the sale.

You will need to provide the bank with enough documentation explaining why you’re going through with a short sale.

Also, be aware that the process with be a lengthy one due to the amount of paperwork. Sometimes it could take up to a year to complete.

What is Foreclosure?

When your house goes into foreclosure, the bank or lender decides to part with the house after, as an owner, you stop making the payments.

While owners are the ones who initiate short sales, the bank or lender is the only one who can initiate the foreclosure process.

Since you’re not making the payments, the bank uses the house as collateral to get their money back in the investment.

Foreclosures either take place after the owner has left the house, or they get evicted once the process begins.

Pros and Cons of Short Sale

Before you consider going through with a short sale, you should weigh the pros and cons.

Pros

The first pro you should consider when selling your home short sale is you avoid foreclosure altogether. There’s a stigma around the word foreclosure that may leave homeowners feeling defeated.

If you consider this a pro, when you short sale your home, you get the satisfaction of knowing you avoided foreclosure.

You can get a real estate agent to take on the listing so you can move the house faster.

While the home goes through the short sale process, you don’t have to make mortgage payments unless you want to. This helps many homeowners repair their finances.

Also, according to the Fannie Mae guidelines, you could buy another house in 2 years instead of 5 to 7. And if you’re not 60 plus days late with your payments according to your credit report, you might be able to buy one right away.

Cons

Of course, short sales also have their shares of cons. For starters, your bank might not allow you to go through with the short sale.

Waiting for a response from the bank might take a really long time, and your finances might not be able to handle it. Not to mention, your credit score could take a serious hit.

It’s also possible your house will still go into foreclosure while you wait to hear back from the bank.

You will have to keep the house in excellent condition while you wait to sell it.

Pros and Cons of Foreclosure

When deciding between short sale or foreclosure, as attractive as short sale might seem, foreclosures are the best option for some homeowners.

Pros

When homeowners cannot wait the long short sale period, foreclosure is the best and immediate solution.

Since money is an issue, when you’re in the process of foreclosure, you can remain living in the house until you get evicted. This will give you an opportunity to repair your finances and until you figure out your next step.

You’re not responsible to keep the house in top shape like you are during a short sale.

Cons

You might lose sleep at night not knowing when you’ll get kicked out of the house you spent so much time making memories in.

You might feel embarrassed around your neighbors if the bank places a “Notice of Public Sale” outside your home.

The impact to your credit could take years to repair. A foreclosure can impact your credit score for up to 10 years.

You might not be able to buy a new house for 7 years. However, if you prove you had to foreclose your house under extenuating circumstances, you might be eligible to buy a house in 3 years.

Who Should Consider a Short Sale?

If you have weighed your options carefully and don’t want to go through a foreclosure, then a short sale is right for you.

The best candidates for a short sale are those who have negative equity on their property and are unable to make the payments on their house.

If you’re able to provide a good explanation to the bank why you need to short sale, you’re a good candidate.

Also, those who are considering a short sale, shouldn’t be that far behind or delinquent on their mortgage payments. Otherwise, the house might go into foreclosure before the short sale process starts.

Who Should Consider Foreclosure?

Some people battle between short sale or foreclosure when they have a bit more options.

However, homeowners who are delinquent on their payments, and don’t have a valid reason to request a short sale, might be left with foreclosure as the only option.

If thinking about your inability to make the payments on your mortgage is keeping you up at night and affecting your health, it might be a good reason to consider foreclosure.

Short Sale or Foreclosure: Which Is Right for You

Short sale or foreclosure, there’s no right or wrong answer. It all depends on what feels right to you and what will bring you the most benefits and free you from the financial burden.

Make sure you do your research to make the best decision for you.

Interested in learning more about whether or not a short sale is right for you? Then visit our blog for more tips.

Why Escondido Has Become A Popular Area For Short Sale Home Buying

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The one thing that can strike fear in the hearts of any homeowner is the thought of a foreclosure. For many of us, the idea of owning our own home is at the root of almost everything we do. We work hard to save and spend days, weeks, and sometimes even months and years to find the right home. It can truly be an emotional as well as a financial tragedy when we see a foreclosure coming up on the horizon. The scars it leaves behind may take years to recover from so many will opt to sell their home through a short sale.

Even though a short sale may be a more favorable option for a homeowner as opposed to a foreclosure, for the buyer it can truly be a win/win situation if you find the right location. By buying a short sale property a buyer can find the ideal investment at a reduced rate in a prime location like Escondido, California and at the same time ensure their future in a great neighborhood to offset their chances of additional investments along the way. Buying in Escondido, California may be one of the best places to give yourself that true winner take all feeling of success.

The Escondido Buyer’s Market

This is where there is an abundance of property available and a shortage of buyers. By buying at this time you get a little additional leverage in your negotiating efforts. By purchasing short sale homes in Escondido, you will be getting your new home at less than its full value. This can amount to a considerable savings in your home buying process and garner you some impressive perks along the way.

The Location

Escondido is ideally situated in a valley just north of San Diego. It offers a quite and peaceful atmosphere separated from the rest of the world by beautiful and majestic mountains. It’s close proximity to San Diego and Los Angeles makes it the perfect location for those who want the busier lifestyle of the city but the quite feel of the country at the same time. A commute to San Diego is less than 30 minutes away and to Los Angeles in around an hour. For those who work in these areas they can have the best of both worlds.

The Climate

Another major appeal for those who want the serenity offered by the City of Escondido is the amazingly temperate climate. The summers are dry with temperatures ranging between a low 60 to a high 90 and the winter temps settling between 42 and 70 degrees. Residents love the climate for its mild climate during all four seasons of the year. They can get the best of each season but not to its extreme as it may be in other similar locations.

The Community

Escondido offers more than 30 different neighborhoods to choose from each offering something a little bit different from the others. Depending on the amount of money you hope to invest in buying a short sale home at a reduced value could place you in an upscale neighborhood that you may not otherwise have considered. Many of these areas boast immaculately manicured lawns and beautiful homes on every street.

They are all located within a very short distance to downtown Escondido where you can enjoy the convenience of shopping and dining at some of best businesses in the city. Whether you’re just looking for a nice place to dine or you need to get your cabinets stocked with the best foods you’ll find you’re just a short distance from anything you could possibly need.

Escondido Schools

Education is an important part of Escondido life as statistics have shown that more than 20% of the city’s residents are holding at least a bachelors degree or higher. There are 22 different schools that make up the Escondido Union School District along with several private institutions to accommodate students of all ages and needs. You will also be in close proximity to several major colleges within minutes of the Escondido. With San Diego just moments south of the city you have access to famous universities like San Diego State College, La Sierra University, Chapman College, and the University of California, San Diego.

Culture

Another reason buying in Escondido has become so popular comes from the lifestyle that many of the residents lead. Aside from its close proximity to the things you need it is also very close to many things that can make life more enjoyable. The city offers parks, playhouses, eating parlors, spas, and beautiful wine country with miles and miles of vineyards to show that residents can enjoy. Year round events can keep you busy as you visit the many annual festivals that residents all enjoy.

Cost of Living

One of the reasons we choose to buy short sale homes is the savings on cost. This can continue even after you’ve purchased your new home. With the cost of living in Escondido, California at about 7% less than the rest of the state you can actually put away a little extra cash while living in some of the nicest areas in the country. With the median household income at a little over $53,000 it is clear why living in Escondido has become such a popular option for many homebuyers.

Escondido is a beautiful city situated in a beautiful setting making it one of the states most popular places to live. Its clean and polished environment will make you feel right at home where you can immediately start to enjoy all of the new and fresh amenities that the city has to offer.

Buying a short sale home is not always easy and may be a major hassle. Think about what you’ll get for your efforts. Not only will you get a beautiful upscale home at an extremely discounted rate but you’ll get a beautiful neighborhood full of all the things that make this type of city great; quality schools, positive communities, a near perfect climate, and year round entertainment whenever you need it. Can buying a short sale home in Escondido work for you? This will depend heavily on what you really want from your new home and community. Why not take some time and talk with an experienced real estate professional in the Escondido area to explore the many possibilities? You may be surprised at what you find out.