2009 will be the year for YOU to grab a piece of this bargain and you will be a PRO after reading all these valuable information. I start holding seminar in 2008 due to the large confusion with all these terms use in today’s market, short sale, REO real estate owned, bank owned property, auction home and foreclosure home.
The first step when home owner miss his payment on his home, would be a phone call from his lender and a mail notification. At this step, the home owner will have to explain the reason why he was unable to make his payment, lost of job, sickness, rate went up, and loan has readjusted.
At this stage you might be able to have a loan modification if you still have an income to cover your mortgage. The problem that I have seen is most of these peoples has a pick payment plan with a negative amortization. So even now, if they want to get a loan modification that will cover interest only, mortgage payment will be much higher than before.
So if you cannot qualify for a loan modification, your next option would be to “Short Sale” your home, you will need to get your lender approval. Your home will be sold for less that the loan amount that you owned, and many times you might have 2 lenders and you will need to get both of them to approve the sale.
For the short sale, you will need to hire a Realtor, just like a normal sale. What I suggest is to start at market price and reduce price until you get an offer. To trigger a short sale you will need to bring an offer in and remember, YOU WILL NOT BE THE DECISION MAKER, reduce the price and bring an offer in.