"Being under water" is a phrase used in real estate when the current market value of a home is below what the homeowner owes on the mortgage.
Boyland, who has served the Westchester County real estate market since 1995, created DontForecloseSellInstead.com in response to numerous inquires from clients about the short sale process.
"We’ve done short sales in Bedford and Mount Kisco and Pound Ridge and Lewisboro," he said. "We get calls every week.”
From homeowners with high home values of $1.2 million to $1.4 million to those in the $400,00 to $600,000 bracket to down around $200,000, trouble paying the mortgage is one problem that does not discriminate.
Boyland advises people not to push off looking into short sales because of the government settlement with the five major lenders in February for $25 billion. Because of that settlement, Boyland said, lenders are approving short sales at a faster rate with better terms. Once the settlement money runs out, he said, "the lenders might not be as generous as they are now.”
According to some sources, Boyland said, foreclosures in New York are backlogged 10 years because they have to go through the court system, whereas short sales do not.
Short sales are a huge benefit to the banks "because they can close out the account and get some of their money back now and stop the bleeding," he said. Banks are also becoming more efficient at processing these types of transactions.
But if the homeowner waits until there is no other choice but to foreclose, the foreclosure process is one that can take months or even years to finalize. Then the house must be put back on the market, incurring the expense of hiring another Realtor.
According to Boyland, short sales are an option some homeowners are only just beginning to see as a win-win: Not only does the homeowner gets a fresh start, but the bank loses less money and the buyer saves. With short sale, homeowners can negotiate down or completely eliminate amounts owed.
Short sales also have less of a negative effect on one's ability to obtain a mortgage in the future, and result in a less significant impact on credit score than foreclosure.
Boyland's new website addresses aspects of the foreclosure debate in one place. For more information, visit Boyland's Realtor website or call Keller Williams' Bedford office at 914-234-4444.
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