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El Dorado Hills Short Sale Question: Should I Stop Paying My Mortgage During The Short Sale Process?

said August 22nd, 2012 John Hayes

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El Dorado Hills CA – We are often asked by short sale sellers whether or not they should continue paying their mortgage payment while they attempt to short sell their home.

Here is the quick answer. Yes, if you care about your credit rating. No, if you don’t care about your credit.

However, many people think that in order to be eligible for a short sale you must stop paying your lender. That is not true. Many lenders will approve a short sale, even if you are current on your payments.

They will consider a short sale based on another hardship, such as a job transfer, job loss, or if you foresee that you won’t be able to make the payments in the near future.

Should you stop making your payments? I am not a lawyer, and therefore cannot give legal advice. I can only tell you my opinion. It all comes down to what is most important to you.

If reducing damage to your credit rating is important, then continue paying for as long as possible. Continue paying your lender until the sale closes.

Halfway into the short sale negotiations, the lender may tell you that they will not process the short sale until you are late on the payments. At that point you can make the decision to continue or stop making payments.

There are some reasons to stop paying your lender during a short sale.

1. You are tight on money. Yes, you will suffer additional credit damage. But, the benefit of using that money for other bills may outweigh the credit damage.

2. You are concerned about a deficiency judgment or promissory note. Many lenders will ask you for a promissory note if they think you have the extra money.

If you want to reduce that likelihood, then you can decide to stop paying. That decision comes with all the side effects such as credit damage and other problems.

Many people also say that is unethical. (I am not going to comment on that. One could make the argument both ways. Every person has to decide what is best for them and make their own personal choices.)

Disadvantages of not paying your mortgage.

1. Credit Damage. You will suffer more damage to your credit. That credit damage should go away in 2-3 years.

In addition, some people use a dispute strategy to get the derogatory marks removed much faster. Some get them removed in 6 months.

The point of this article is that contrary to public opinion, you do not have to stop paying your lender in order to short sale your home.

You can minimize the credit damage by continuing to pay until the short sale closes. Thinking about a short sale?

I can help you short sale your property and get back on your feet. Send me an e-mail at [email protected]. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at 530-306-3316

Thanks for reading this, John J Hayes.

John J is a Real Estate Agent at RE/MAX Gold.

Phone: 530-306-3316. [email protected].

“Hard Work and Dedication”

View My homes for sale at www.johnhayesrealestate.com/home-search.

John Hayes specializes in loan modification assistance and short sales in El Dorado Hills California. El Dorado Hills Loan Modification Help, El Dorado Hills Short Sales. El Dorado Hills Short Sale Realtor. Sacramento CA Loan Modification Help, Sacramento CA Short Sales. Sacramento CA Short Sale Realtor. Folsom CA Loan Modification Help, Folsom CA Short Sales. Folsom CA Short Sale Realtor. Mather CA Loan Modification Help, Mather CA Short Sales. Mather CA Short Sale Realtor. El Dorado Hills CA Short Sales. El Dorado Hills Realtor.

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Important Notice

John J Hayes, RE/MAX Gold, and the Stop Foreclosure Institute are not affiliated in any way, shape, or form with the government. Our services have not been reviewed or endorse by the government or your lender. Most lenders willingly work with agents on short sales. Why?

Because most short sales are beneficial to a lender. If you accept our offer to help you on a short sale, your lender may not agree to a short sale or to modify your loan. We do offer a loan modification kit.

However, the likelihood of negotiating a modification is like everything else in life. It takes work and persistence to convince your lender to modify your loan. No matter what you or we do, your lender may not approve a loan modification.

We do not recommend that you stop paying your mortgage, because this will cause damage to your credit and could cause you to lose your home. Because we know avoiding foreclosure is so important to any homeowner, we recommend that you speak with the appropriate legal or tax advisor before making any decision.

This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing.

You have the option to reject a short sale or loan modification from your lender if it does not meet your approval. If you decide not to go thru with the short sale, then you do not have to pay us our fee. We normally make a real estate sales commission for helping you on a short sale.

The views expressed here are John J’s personal views and do not reflect the views of RE/MAX Gold.

This information on El Dorado Hills Short Sale Question: Should I Stop Paying My Mortgage During The Short Sale Process? is provided as a courtesy to our viewers to help them make informed decisions.

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