Name – Edward and Anna from Elgin, IL
Occupation – Manager and teacher
Income – $75,000 combined
Total Debt Load – $125K mortgage 1 + $20K HELOC = $145K
Do you qualify for a short sale? Find out here:
Qualifications for a short sale
Reason for Selling:
After being downsized at his company, Edward found himself unexpectedly unemployed. As the family’s main breadwinner, the family counted on his paycheck for stability. He was able to find a new job quickly, but he was disappointed in the large pay cut. With the reduced income and bills piling up, the family quickly drained their emergency fund. Although Edward was trying to find a better paying position, it was going to take longer than they expected. Edward and Anna realized the mortgage was now out of their comfort range to afford.
First, they talked with their lender and were able to get a temporary reprieve on their payments with a loan modification. However, the loan modification ran out after 6 months’ time and the regular mortgage payment was reinstated. Edward had not found better employment and they were no closer to affording their mortgage. Edward and Anna decided to look into a short sale and remove their mortgage burden.
Next steps: a pre-screening and a market analysis
Talking with them at their kitchen table on a quiet Tuesday night, we knew right away we could assist them. When Edward and Anna contacted our team, we knew they had exhausted all efforts to save their home. They had just hit a rough spot along the road of life, as so often happens. First, we looked over their mortgages and expenses. Then we looked at current market values for homes in the area.
A comparative market analysis for the home indicated a market value of $120K, which was less than what was owed. This property was underwater, meaning they owed more than what it was worth. The home was in fair condition and would be sold as-is. Edward and Anna were relieved to find out that they did not need to make any repairs or fixes on their home before the short sale. They paid no money out of pocket for the short sale. Our team listed the home at $119,900. A buyer made an offer of $110K, which the bank countered to $115K. The buyer agreed and the short sale was processed.
Under the short sale process, the lender also took care of the attorney fees, closing costs, title fees, and agent commissions. Using a program called Home Affordable Foreclosure Alternatives, or HAFA program, Edward and Anna could receive a closing cost credit of $10,000 because they were owner occupants with a clear hardship – loss of income. They also realized a short sale would impact their credit score for a much briefer time period than a foreclosure. The family decided it was the best strategy for them and completed the short sale.
After short selling their home, Edward and Anna made a difficult decision to move in temporarily with family locally in Elgin, IL, until they could sort out their next steps. Edward continued to look for work. Their patience and persistence paid off. Five months after the short sale was completed, Edward found a better paying position with a new company in the area. They are saving up their money, rebuilding their emergency fund, and plan on buying another home soon.
Did you know?
In addition to short sales, Fox Valley Short Sales offers full broker service for regular and distressed listings, for all buyers and home sellers, rentals, as well as investors in residential properties across the northern Illinois and Chicago region. All team members are trained to coordinate short sales effectively and retain the full skills and expertise of fully licensed Realtors®, including access to the resources of the local Illinois MLS database.
For more information and details on short sales and more, please contact Jennifer Kinzle, 630-854-4360. Email me direct email@example.com to get on track for 2016.
Direct/Text: (630) 854-4360
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Charles Rutenberg Realty of Illinois
1733 Park St, #150
Naperville, IL 60563