Are you upside down on your house?

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By Steve Levine

Happy holidays everyone. Looks like the marketplace is starting to stabilize at last, and the end of 2011 seems like it will pan out to be a more balanced marketplace than we'se seen in a while.

Just last week we had a several multiple offer situations on properties I was involved with, and that's always great. As challenging as they are, I have to admit it was nice to see them out there again. I think the buyers have finally come to the conclusion that the historically low interest rates along with a reset to 2001 pricing have made the homes out there just irresistible. My prediction is that 2012 may turn out to be the best year in a long, long time – punctuated by what will likely be a shortage of inventory that may yet drive pricing upwards.

One thing I's starting to work on a lot more are short sale opportunities. These are created when a seller is “upside down” on their home, meaning that they owe more to the bank that it is worth in today's market. I'se put together a team of professionals that do nothing all day but negotiate on our clients” behalf, and this has been a real lifesaver for many. With the relationships they'se built up with the lenders, they are getting these deals approved in record time.

Why is a short sale a useful tool? By far and away one of the worst things to deal with is a foreclosure. That's far worse even than a bankruptcy, in terms of its far-reaching impact on your life. If you owe $425,000 and the bank forecloses, they can sell it at public auction for much less. If they sell for $375,000 at auction, you not only have no house, but the bank can still go after you for the $50,000 shortfall as a deficiency judgment, and make your life miserable for years, even when you'se long since out of the house. In the case of a short sale, we may find a buyer for $400K and get the bank to accept the $400K as a full discharge, without reflecting that as a negative on your credit report.

The process of a short sale using begins with a realtor like myself who is very familiar with short sales. Often, this process will start with a market analysis or appraisal that establishes that the estimated sales price will not meet the amount of the payoff. Once that is in place, the rest is a matter of “teamwork.” My dedicated in house team of attorneys can take the bulk of the work out of your hands, and streamline the process of getting a lender approval. To date, they'se had tremendous success with the local and national lenders, and have been a real stress reliever for our sellers.

Some sources estimate that up to 30 percent of the homeowners in the nation currently have negative equity in their properties, so this will be a huge factor in all of our lives. By handling short sales proactively, rather than reactively, and putting the right resources out there to bear, we can ensure a simple, calm selling process from beginning to end.

For more information on short sales, e-mail me at [email protected] or call 1-508 735-4663, and we can take a moment to chat about options.

Steve Levine is President of Steve Levine Inc., and an agent at REMAX Prestige. He has been ranked as the #1 REMAX Agent in New England for 10 years, and can be reached online at www.stevelevine.com.