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Arizona Short Sales Have Advantages & Disadvantages

by Charlie Allred

When looking into Arizona short sale help, it is important to realize that there can be positives and negatives. Aside from going into some sort of loan modification scenario, the Arizona short sale is probably the most common way to get out of a poor situation if you are upside down on your home.

The thinking is that by going the short sale route, you can avoid the more devastating effects of a foreclosure… which of course is always a wise thing to do.

Basically, your lender will need to agree to the terms of your short sale package (which should always be prepared by a short sale expert) in which you sell the home for less than what is owed on the mortgage. In most cases you will already be in default, or facing a high probability of having your home foreclosed on. Once you have the lender’s approval and hopefully have negotiated for forgiveness of the outstanding debt, the sale can go forth and you and the lender both win.

As with everything, there may be consequences to making this deal. We will take a look a some of the possible disadvantages first.

  1. The bank can come after you for the balance of the loan or what is known as the “deficiency balance” by issuing you a 1099. In most cases you can escape this problem by hiring the right short sale negotiator to help you.
  2. The second issue may be that it becomes difficult to locate a buyer for your short sale. In Arizona, it can take longer to go through the sales process and that can put some buyers off.
  3. Although, your credit rating will not be as affected as with a foreclosure, your credit rating will still be altered. To what extent is somewhat of a guess as it varies from person to person. Just know that going in.

On the flip side of the Arizona short sale, we have the positives as well. And, of course the biggest advantage is that:

  1. You get to rid yourself of the onerous debt load you are carrying! Assuming all goes well, the bank will agree to accept less than what is owed.
  2. In many cases, the lender will actually pay the closing costs that the you are normally liable for.
  3. Finally, it could turn out that there is a very small hit to your credit. That is a viable possibility if the lender chooses to report you as “paid satisfactorily” to the credit reporting agencies.

Certainly, talk to your local short sale expert so that you receive the highest quality short sale help available to you here in Arizona. And, We have prepared an entire series of articles for you to educate yourself… follow this link for more information on the Arizona short sale.

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