Real Estate
Short Sales
A short sale is a real estate transaction where a lender agrees to the sale of a property for an amount that is lower than the outstanding balance of the mortgage. To proceed with a short sale, a seller will first need to get approval from his or her lenders. The Real Estate Team at Butters Brazilian endeavor to achieve the best results for our clients engaging in these transactions throughout Boston and the surrounding communities.
Frequently Asked Questions
A short sale happens when a homeowner sells a property for less than the amount owed on the mortgage. The lender must agree to accept the offer even though it’s less than what’s owed.
A short sale can help avoid or reduce the damage to your credit.
It gives more control to the homeowner over timing and process.
Foreclosure often carries greater legal, financial, and personal risks.
You’ll generally need to prove financial hardship (job loss, illness etc.), show that you can’t reasonably make mortgage payments.
Provide documentation of income, expenses, bank statements, tax returns.
Submit an offer from a buyer along with property value documentation (often through a Broker’s Price Opinion or comparable sales).
The short sale process can take a long time (often several months) because of lender review.
The lender may refuse an offer if it’s too low relative to market value.
You may face a deficiency judgment (owing the balance after sale) unless it’s waived.
There may be tax consequences if forgiven debt is considered income.
An attorney can help negotiate with the lender to try to get better terms or a waiver of the deficiency.
Ensure that the purchase & sale agreement is structured properly (including short sale contingencies) so you’re not locked in without lender approval.
Help you understand and deal with the documents, deadlines, disclosures, and legal obligations (including zip codes, tax, potential liability etc.).
