Although a short sale (selling your home for an amount lower than the outstanding mortgage) is not exactly a “win-win” for you and your lender, but it has certain benefits that your Miami real estate attorney can discuss with you. Most importantly, you will benefit because the foreclosure will not get recorded in your credit report.
Assuming that you may want to own another home in the near future, a short sale strategy will help you present yourself as a more attractive borrower.
Expected Continued Success for the Bankruptcy Pilot Program
Florida residents may see a change in the housing market landscape if a certain bankruptcy pilot program continues to be successful. A recent story in the South Florida Real Estate News shows how a U.S. bankruptcy senior trustee’s idea to trade foreclosures in for short sales is helping to ease the pain of discharged debts for creditors.
Typically, when a person files bankruptcy and surrenders their residence, the lender will opt to place the home in foreclosure rather than disposing of the real estate through a short sale. This practice is commonplace during bankruptcies but had the trustee curious as to whether there was a better way to recover some of the lost assets.
Last year, the senior trustee got the permission of two of the nation’s leading lenders; Fannie Mae and Freddie Mac, as well as some others on board for a pilot program meant to speed the sales of properties that had been surrendered during bankruptcy. The lenders participated in the program piloted in the southern and middle districts of Florida and saw results. To participate in this program, lenders must be willing to put some of the sales proceeds toward the owner’s unsecured debts. Not only does this program move homes quickly, but it can also ease the sting creditors feel after a consumer files bankruptcy.
According to the trustee, the pilot program is experiencing great success in the areas it has been offered. Over a six-month period, the trustee has closed on 15 houses that had been surrendered during bankruptcy and plans to close on many more. With hundreds of people requesting information on the list of short sale homes, it may be likely that the pilot program is here to stay.
While some people who file bankruptcy surrender their homes to their lenders, many wish to remain in their homes and reaffirm their mortgage. If you are considering bankruptcy and need help deciding what you can do about your mortgage, you may benefit by speaking to a trusted bankruptcy attorney.
Schedule a Consultation With a Trusted Miami Real Estate Attorney
Call the Lawyer of the Decade! Miami real estate attorney, Patrick Cordero, will be personally involved with your case. To schedule a consultation, call us at 305-445-4855 or contact us online.