Helping Sellers, Buyers, & Landlords in VA, MD, DC 



Help Selling - Short Sale Assistance


Important Tips:

  • Don't ignore it
  • Contact the lender and see resources below
  • Respond to mail from the lender
  • There are housing counselors with the jurisdiction you live in.
  • There are various scams out there that promise to stop foreclosure immediately if you sign a document where you sign over the title, commit fraud, or cheated out of your property - never sign a legal document unless you read it and understand it!
       Certified Distressed Property Expert - Kirill Gorbounov and Elena Gorbounova Short sale foreclosureBPOR
Are you aware of someone late on mortgage payments?
 
Typically Foreclosures may drop your credit score from 250 to over 300 points and usually affects the score for over 3 years while Short Sales sometimes can have little or no affect on your credit score.
 
Foreclosures remain on your credit history for 10 years or more while Short Sales are not reported on your credit history the same way.
 
So Call us today for a confidential consultation and additional information. 
   
As a Certified Distressed Property Expert and REALTOR, I will provide vital skills and knowledge to save the credit, alleviate the insecurity and most importantly, help the family. As a CDPE, I can save 8 out of 10 people from foreclosure. Time is of the essence!
 
 

Did you know 7 out of 10 who foreclose never talked to anyone?
(See Additional Government resources below.)

 

What Is A Short Sale?

 

In a Short Sale the bank lets the property sell for less than what is owed on the note.

 

Why Would the Bank Consent To Lose Money?

 
  • Lenders lend money and they are not in the business of owning homes. On average the REO process costs $40,000 more. 

I've Already received the Foreclosure Notice ... Is It Too Late To Do A Short Sale?

  • NO. 

I Haven't Missed Any Mortgage Payments.  Can I Still Do A Short Sale?

  • YES. We simply need to establish hardship of why the payments will stop in the near future.  

Do I Need to Bring Money to the Table (Commissions, Taxes, Closing Costs)?  

  • Typically all expenses are paid by the lender. 

What about a 1099?  

  • In December 2007, President Bush signed into law, the Mortgage Forgiveness Debt Relief Act, which eliminates the capital gain income tax that used to be levied on the forgiven portion of the primary residence's sale.  The tax is still in effect for second homes, and investment properties. For details please consult with a CPA.
Reasons To Avoid Foreclosure:

Lenders may obtain Both Judicial Foreclosure and Non-Judicial Foreclosure options are available to lenders in Virginia. Lenders can also obtain deficiency judgments, without limits, in Virginia.

 

Concern
Foreclosure
Short Sale
Fannie Mae Loan for Primary Residence in the future (May 21, 2008).
Ineligibility for 5 years.
Ineligibility for 2 years.
Future Fannie Mae Loan for Non Primary Residences - Investors (May 21, 2008)
Ineligibility for 7 years.
An investor who successfully negotiates and closes a short sale should be qualified for a Fannie Mae backed investment mortgage after only 2 years.
Future Loan with any Mortgage Company
On any future 1003 Application (Standard Loan Application), a prospective borrower will have to answer YES to question C, in Section VIII, that asks, “Have you had property foreclosed upon, or given title or deed in lieu thereof?” This will affect all future rates.
There is no similar declaration, or question regarding a short sale.
Credit Score
Score may be reduced from 250 to over 300 points and in general affects the score for over 3 years.
After the sale, the mortgage will be described as paid or negotiated, which can lessen the score as little as 50 points, if all other payments are made. The effect can last as short as 12 to 18 months.
Credit History
10 years or more on the public record in the person’s credit history.
No particular item reporting it as a “short sale”. Normally the loan is reported as “Paid in full, settled.”
Security Clearances
 
In most cases the clearance is revoked and the position as a result is terminated as a result of a foreclosure.
A short sale by itself does not contest most security clearances. 
Current Employment
Many employers exercise the right to regularly check the credit who are in sensitive positions and a foreclosure is grounds for immediate termination or reassignment. 
Since a short sale is not reported on a credit report and thus not a test to employment.
Future Employment
Since many require a credit check for all job applicants then it might be a problem.
Since a short sale is not reported on a credit report and thus not a test to employment.
Deficiency Judgment
100% of the time the bank has the right to pursue a deficiency judgment.
Sometimes it's possible to pursuade the bank to give up.
Deficiency Judgment Amount
Foreclosures go through an REO process if it does not sell at auction, which typically results in a lower sales price, a longer time to sell, and consequently in higher possible deficiency judgment.
The home is sold close to market value resulting in a lower deficiency amount.

 


Kirill GorbounovCell: (571) 276-0986
Email Kirill

Elena GorbounovaCell: (703) 625-7888
Email Elena



-  Judicial Foreclosure Available: Yes

-  Non-Judicial Foreclosure Available: Yes

-  Primary Security Instruments: Deed of Trust, Mortgage

-  Timeline: Typically 60 days

-  Right of Redemption: Varies

-  Deficiency Judgments Allowed: Yes

In Virginia, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process.

Judicial Foreclosure

The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, is used when no power of sale is present in the mortgage or deed of trust. Generally, after the court declares a foreclosure, the property will be auctioned off to the highest bidder.

The borrower has two hundred forty (240) days from the date of the sale to redeem the property by paying the amount for which the property was sold, plus six (6) percent interest.

Non-Judicial Foreclosure

The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A "power of sale" clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative, typically referred to as the trustee. Regulations for this type of foreclosure process are outlined below in the "Power of Sale Foreclosure Guidelines".

Power of Sale Foreclosure Guidelines

1.     If the deed of trust or mortgage contains a power of sale clause and specifies the time, place and terms of sale, then the specified procedure must be followed. However, additional requirements must be met, as outlined below in section one (1). 

Even when the deed of trust makes allowances for advertising the foreclosure sale, Virginia Statutes require ads to be published no less than once a day for three days, which may be consecutive days. These requirements are in addition to the advertising terms stipulated in the deed of trust. If the deed of trust does not provide for advertising, then the ad shall be run once a week for four successive weeks. However, near a city, an ad on five different days, which may be consecutive, will be sufficient.

A copy of the advertisement or a notice with the same information must be mailed to the borrower at least 14 days before the foreclosure sale. 

2.     The foreclosure sale ad must include anything required by the deed of trust and may include a legal description of the property, a street address and a tax map identification or general information about the property's location. The notice must include the time, place and terms of sale. It must give the name of the trustee and the address and phone number of a person who will be able to respond to inquiries about the foreclosure sale.

Any time before the sale, the borrower may cure the default and stop the sale by paying the lien debt, costs and reasonable attorney's fees.

3.     The sale, which may be held no earlier than eight (8) days after the first ad is published and no more than thirty (30) days after the last advertisement is published, is to be made at auction to the highest bidder. Any person other than the trustee may bid at the foreclosure sale, including a person who has submitted a written one-price bid. Written one-price bids may be made and shall be received by the trustee for entry by announcement of the trustee at the sale. Any bidder in attendance may inspect written bids. Additionally, the trustee may require bidders to place a cash deposit of up to ten (10) percent of the sale price, unless the dead of trust specifies a higher or lower amount.

In the event of postponement of sale, which may be done at the discretion of the trustee, advertisement of such postponed sale shall be in the same manner as the original advertisement of sale. 

4.     Once the sale is complete, the proceeds will go to: 1) the expenses of executing the trust; 2) to discharge all taxes, levies, and assessments, with costs and interest if they have priority over the lien of the deed of trust; 3) to discharge in the order of their priority, if any, the remaining debts and obligations secured by the deed, and any liens of record inferior to the deed of trust under which sale is made; 4) any remaining proceeds go to the borrower.

Lenders may obtain deficiency judgments, without limits, in Virginia.