Absolutely – each and every situation out there has different circumstances and different ramification to a seller. There are several new and ever changing laws that can have a huge impact on you and the outcome of a short sale. The short sale process is actually not a new thing. Banks have been doing short sales for years and years, but never at the rate we are currently seeing banks being asked to approve the terms of a short sale.
A couple things to keep in mind and ask the attorney.
- Is your mortgage your original mortgage or that of a refinance
- If you have a first and a second were they taken out at the same time – what is commonly called a 80/20 loan
- If you refinanced did you take any money out
- Is your second mortgage a HELOC (or what is called a Home Equity Loan
- Do you live in the home, if not have you lived in the home
There are many more questions your attorney will ask – but these will help your attorney guide you in the right direction. Just as your attorney will have questions, so should you. A couple things you will want to know is;
- Can the Bank come after you for a deficiency
- What are my risks to short sale vs foreclosure
- What is all the whispers about this 6 year rule about a a deficiency
- Will my lender release me from the deficiency
There are many more questions to ask and with the government changing the rules, getting involved there will be more questions down the line than there are today.
In my personal opinion, a short sale will reflect better on your credit someday. Will it immediately? No it will look the same as a foreclosure will, but with the mortgage mess we have I firmly believe someday the person that fell into an issue with employment, or health and did the best they can will be looked upon differently than the person that just walked away.
Seeking advice from a Real Estate Attorney is highly advised with all the changes we are seeing. Understanding the risks, is an advantage to you.