Detroit Real Estate

Many people go back and for whether they should do a short sale or not.  You have to decide when it makes sense for you to do a short sale.  Is it worth the trouble if the bank isn't cooperating?  Is the bank being stubborn on the price?  Is the second mortgage company being hard nosed?  Is the bank requiring you to sign a deficiency?

Let me explain this a little bit.  When you sell your Metro Detroit home via a short sale there is two ways for the bank to go.  They can forgive the deficiency, and give you a letter releasing you from any liability from the deficiency.  Or they can refuse to give you a letter.

If the bank refuses to release you from the liability, then you are possibly responsible for the deficiency.  Then it may be smart NOT TO DO A SHORT SALE.  Now this is just my opinion.  Why would you go through the whole hassle of doing a short sale if the bank can come back after you for the deficiency?  The only reason I can see is if you can keep your credit in tack and the bank won't report the short sale on your credit report.

From what I have been told is if you can get through a short sale without getting behind on your mortgage payments it is a good thing.  It is better for you and your credit report than if you had 90 day lates or a foreclosure on your credit report.  But nobody knows for sure how badly a short sale will affect your credit report.  It depends on whether you have late mortgage payments or not.

But my opinion is that if you are going to be responsible for the deficiency it is better off to let the home go into foreclosure.  Then you are through with the home.... very seldom do banks go after people that have lost their home in foreclosure.

Now let me say this.  You need to seek legal advice from a real estate attorney before you make these choices.  You should also talk to your CPA or the person that does your taxes.  You need to know all three of these aspects:

1. Your possible legal liability
2. Your future financial liability / ability to get back on the right financial path
3. What this will do to credit / can you survive with bad credit for three to seven years? 

Don't rely on my opinion.  Get professional advice from those who specialize in those fields.  They are better to guide you on what to do.  But it is your decision alone.  Choose carefully.

More Michigan home selling tips

Feel free to contact me if you make a decision to sell your home as a short sale.  I will be glad to help you get it sold.

                       Russ Ravary

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My quote of the day is:

Whenever you make a mistake or get knocked down by life, don't look back at it too long. Mistakes are life's way of teaching you. Your capacity for occasional blunders is inseparable from your capacity to reach your goals. No one wins them all, and your failures, when they happen, are just part of your growth. Shake off your blunders. How will you know your limits without an occasional failure? Never quit. Your turn will come. 

                                                                     Og Mandino