It's not been a pretty picture in the Brockton real estate market. Prices are dropping, appreciation is stalled, and homeowners whose mortgages are adjusting to higher interest rates are worried that they can't keep up.
Realty times reports in a recent article "Foreclosures and short sales are becoming the highly-talked about topic in real estate. Reports from last quarter show the number of default notices (NoDs) sent to homeowners increased to its highest level in nearly 10 years. This flood of delinquencies is causing short sales to become more popular as a solution for homeowners who need to get out of their properties as painlessly as possible.
"A short sale is the same as a displacement issue. It's when the homeowner cannot afford to make the payments on his loan due to whatever circumstance, and the majority of those distressing circumstances seem to be an adjustment of a mortgage," says Tom Ziegler, Short Sale Support Facilitator
"The short sale path ends by agreement with the lender that [the lender] will approve the sale of the property to a buyer and it results in an escrow, documentation and we have a short sale consummation," says Ziegler.
It's also important to understand that you could face a 1099 in the future -- meaning you could be taxed down the road on the sale of your home due to the lender's suffering a loss of principal of $600 or more.
The benefits of the short sale to the homeowner is that the impact on their credit will be substancially lower than that of a foreclosure
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