Jump to Navigation
We can handle your closing anywhere in the state.
Subscribe to This Blog's Feed

Got an underwater home? Consider a short sale

The U.S. housing market is finally on the mend, and we can ascribe some of that success to the practice of short sales. Short sales are an increasingly popular alternative to foreclosure, in which a homeowner sells the house for less than they owe on the mortgage. The bank takes the income from the home sale and forgives the remaining balance on the mortgage.

Ten years ago, short sales were a relatively rare commodity. Today, however, they have become commonplace. Banks are much faster at processing short sales, and in recent years they have come to recognize that short selling is often a cheaper and faster method than foreclosure.

When a home is sold in foreclosure, it is often in fairly rough shape. It usually has not been inhabited for months, and the long period of disuse generally decreases the home's value. Vandals or thieves can damage the home even more. By contrast, a short sale often occurs just a few days or weeks after the decision is made. The homeowner usually lives in the house right up until the point of sale, protecting its value.

Though the home is sold for less than the value of the mortgage, the losses incurred by the bank are often favorable compared to the losses experienced in foreclosure. Foreclosure requires a great deal of time and manpower; forgoing this option is often more economical for the lender.

Homeowners benefit by escaping from beneath an underwater home. When a home is underwater, it can seem very difficult to rid oneself of the property, as a sale would not be sufficient to cover the amount owed on the mortgage. A short sale allows homeowners to walk away from their home with a sense of freedom.

Of course, a short sale must be agreed upon by the bank. Working with the bank is not always an easy process, and it can sometimes be difficult to protect one's interests once the short sale begins. In such cases, it's often wise to speak to a real estate attorney. An attorney can assist the homeowner during the short sale by working to ensure that homeowner's financial liabilities are minimized at the end of the sale.

Source: The Wall Street Journal, "Help for Underwater Homes," Conor Dougherty, March 5, 2013

No Comments

Leave a comment
Comment Information
Tell Us About Your Transaction

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

Visit Weeks & Irvine at One of Our Six Locations

North Charleston office 8086-B Rivers Avenue
North Charleston, SC 29406
Phone: 843-553-9800
Toll Free: 800-553-7449
Fax: 843-553-9804
Maps and Directions

Mt. Pleasant office
1100 Queensborough Blvd, Suite 102
Mt. Pleasant, SC 29464
Phone: 843-856-9800
Toll Free: 800-553-7449
Fax: 843-216-0930
Map and Directions

Mt. Pleasant North office
3040 Highway 17-A North, Suite B
Mt. Pleasant, SC 29466
Phone: 843-388-3250
Toll Free: 800-553-7449
Map and Directions

West Ashley office
873 Orleans Road, Suite 102 1/2
Charleston, SC 29407
Phone: 843-571-2996
Toll Free: 800-553-7449
Fax: 843-571-2998
Map and Directions

Summerville office
106 West 7th North St
Summerville, SC 29483
Phone: 843-875-7111
Toll Free: 800-553-7449
Fax: 843-875-7721
Map and Directions

Goose Creek office
567 Crowfield Blvd.
Goose Creek, SC 29445
Phone: 843-553-9100
Toll Free: 800-553-7449
Fax 843-553-9183
Map and Directions