When to use a short sale or foreclosure?

The borrower can take the advantage of new mortgage after 5 to 7 years in foreclosure and after two years in case, the property is put to short sale. Foreclosure is used when a mortgagor is unable to make payment.

Can a short sale house be owned by the bank?

A short sale house is a home that is not owned by the bank. However, in order for the sale to close escrow, the bank must approve the sale. The title is still in the name of the homeowners, and the owners often live in the property because they can’t afford to go anywhere else.

When does a house become a pre foreclosure?

A home is in pre-foreclosure if a homeowner is more than 90 days late on the mortgage payments and the bank has begun the foreclosure process. “A pre-foreclosure is a property in the process of foreclosure but is still legally owned by the owner. It may or may not be a short sale,” says Beverley Hourlier, a real estate agent in San Diego.

What are the pros and cons of buying a foreclosure?

Learn the pros and cons of buying a foreclosure home, get tips on finding foreclosures, and find out how to successfully negotiate a short sale. What Is a Deed in Lieu of Foreclosure?

Can a short sale be an alternative to a foreclosure?

The short sale transaction is used as an alternative to a foreclosure because it mitigates reoccurring or additional fees to both the borrower and creditor. That being said, the short sale does not come without negative externalities; a short sale will often result in a negative credit filing against the owner of the property.

When does a bank foreclose on a home?

A foreclosure is the process by which a mortgage lender terminates an existing mortgage through a court order or by an operation of law. Foreclosures occur after the borrower (individual who takes out the mortgage from a bank to purchase a home) fails to meet the payment obligations outlined in the loan agreement.

Who is the investor in a short sale?

A short sale is undertaken by an investor and a homeowner who cannot meet their mortgage requirement. The investor purchases the home below the mortgage amount (at a discount) and assumes ownership of the house.

Is there a way to invalidate a foreclosure sale?

Attempting to invalidate the sale in a judicial foreclosure can typically be done in the following ways, depending on state law: If the foreclosure case stays open through completion of the sale process, then you can raise an objection to the legitimacy of the sale in that case.