Short Sale- Myth # 2

Myth # 2: It's smarter for homeowners to walk away than to short sell their home.
As Tara-Nicholle Nelson says in her article Yes and No. "Increasingly, I,m hearing those who own upside down homes ask why they would bother with a short sale, when they could just walk away with much less effort and drama. The reality is that walking away and letting your home go to foreclosure is an extremely serious, personal decision - the wisdom of which varies dramatically owner to owner and state to state. Some states allow lenders to sue homeowners who default on their mortgages, and impose taxes on the mortgage debt cancelled out in foreclosure, sometimes totalling tens of thousands of dollars.

Other homeowners' family and financial plans would be impaired much less by a short sale than by a foreclosure. For still others, it's pretty much a wash. For everyone, though, it is faster to recover your credit and ability to take out another mortgage on a new home after a short sale than after a foreclosure.

Given that a short sale costs a seller little or nothing except some time an effort, in many instances it is smarter to make an effort to short sale than it is to walk away."

Uncle Fred