When the owner can't afford to keep paying the mortgage there is a the possibility of a short sale. The home will be sold at a much smaller price. This is not the ideal way to make a sale but it's an alternative to bankruptcy.

If a person accepts a short sale that means that he is agreeing to receive less than the total amount due. It's important to know that not all sellers qualify for a short sale. The lawyer can help you figure out if you can have a short sale or not.

Before deciding to purchase a short sale you should obtain first legal advice from a real estate lawyer. Also is important to discuss with your accountant the tax ramifications. It's possible that all the debts forgiveness will be considered as income.

The first step is to submit a letter of authorization which must include the property address, the loan reference number, your agent's name and contact information. If you do this you will receive better cooperation from the closing agent or the lawyer.

Your lawyer or agent should prepare a preliminary net sheet. This will show the sales price and all the costs of the sale. If you find it impossible to calculate all these fees they will be able to make a clear list for you. If you don't understand anything feel free to ask. Read more