You Want to Sell Short? Really!?!
You Want to Sell Short? Really!?!
blog1.jpg

Dec 07,2016

You Want to Sell Short? Really!?!

He told me that his hours at work had been cut back, so he did not think he could keep paying the mortgage. He was pretty certain that the house would not sell for enough to cover his debt. So he would rather “let the house go”, and rent something more affordable… get his financial feet back underneath him. I can understand his thinking, but a further conversation revealed that there was so much Nathan was unaware of about the impact this plan would actually have on his financial life. And he also did not know that he had another option.

When we discussed how we could lease the property and how he could earn a positive cash flow, he was immediately sold. So just what was it that he would have given up had he gone with the short-sale?

  1. His credit rating would have been destroyed for at least 3 years. (Currently, HUD allows home-loan borrowers to qualify after 3 years from the closing on a short-sale.)
  2. He would have lost the tax benefits of holding investment real estate in his portfolio.
  3. He would have forsaken the likelihood of property value appreciation in the out-years.
  4. He would have lost the positive effect of loan amortization which would increase his equity in the property.
  5. He may be strapped with a default judgment that would hang over his head for many years.
  6. If the short-sale was ultimately disapproved (about an 80% probability), the property would have been foreclosed on. (His credit rating would suffer equally under foreclosure as in a short sale, but the negative affect would have just lasted longer.)

Essential to the above solution is for a homeowner to get help before letting the house payments go into arrears. Once the homeowner starts getting buried beneath the debt, it is very difficult to get out from underneath. Sometimes, selling short is unavoidable though, and that will be the subject my next blog.

Please give 3 Options Realty a call and schedule professional property managers in Roswell, GA.


Daniel R. Wilhelm
Managing Broker
3 Options Realty, LLC.
http://www.3optionsrealty.com
678-397-1282

Recent Blogs

small1
Mar 27,2024
Common Misconceptions About Property Management

Owning rental property can be a lucrative investment, but…

Read More
small1
Mar 21,2024
Do Property Managers Pay for…

Whether a landlord or property manager, various responsibilities are…

Read More
small1
Mar 14,2024
6 Ways to Win a…

In the competitive real estate market, winning a bidding…

Read More

Landlord Options

small1
Owner Portal

In appreciation for your continued patronage, we are pleased to offer you a management fee rebate equal to 2 months of management fees for any…

Read More
small1
Leasing & Management

If you are interested in professional property management services, you probably have some questions about the process and we have a few questions we…

Read More
small1
Rent Disbursement

Standard Rental Proceeds Disbursement Policy. It is the standard policy of 3 Options Realty to disburse monthly rental proceeds to property owners between the 15th…

Read More

We Are Ready to
Take Your Call

lander1

If you have been rummaging through web results for “property management companies near me,” then you are at the right place. 3 Options Realty’s property managers in Atlanta are experienced and trained to deliver top-tier service. Call 3 Options Realty to speak with a friendly representative today to learn more about our property management & real estate services. We are ready to take your call.

Buy, Sell & Rent with 3 Options Realty

lander1

We use professional market research to determine fair-market rent, and we use broad market advertising to reach a large audience. Our agents will also help you prepare your property and skillfully present your property. Prospective tenants will undergo comprehensive interviews and background screening before we negotiate with them the rental agreement using our proprietary, attorney-reviewed forms.