Shortsale: How to Short Sale Process in Arizona

Shortsale: How to Short Sale Process in Arizona

Shortsale: How to Short Sale Process in Arizona

Shortsale: How to Short Sale Process in Arizona

What is the Short Sale process in Tucson and Phoenix AZ?

It’s common for attorney’s to advise distressed homeowners to foreclose and protect themselves from the bank pursuing the defiency judgement. When in fact, 98% Arizona short sale approval letters offer no pursuit of the deficiency, no tax liability on forgiven amount, and usually seller relocation cash of $3k or more. Most attorney’s haven’t seen an Arizona short sale approval letter to know these facts & benefits to advise the seller. If more sellers knew their options, then the market would be full of short sale listings and buyers drooling over the purchase.

MyOwnArizona typical Short Sale Process in Arizona is as follows:

  • After initial contact and screening we will make an appointment to visit you and your Tucson or Phoenix house for Short Sale consideration. We will go over the necessary forms and have you sign each document. We will also ask for copies of the following documents:
    • Mortgage statement
    • Bank statements
    • Pay stubs
    • Tax returns
  • The house is put up for shortsale and MyOwnArizona will advertise the shortsale heavily along with traditional realtor listings. MyOwnArizona Tucson Real Estate Network will initiate the short sale with a lender.
  • When an offer to purchase short sale is received, you sign the sale contract and MyOwnArizona begins the negotiations with the lender(s) and lien holders. After the offer is accepted by all lenders and lien holders, a closing date is set. Property owner must move out prior to closing.
  • Property owner goes to Title Company for closing and signs closing documents. On average, a couple of months after the process was started, the Tucson or Phoenix Short Sale is completed and the foreclosure has been avoided.


What are Arizona Short Sales?

A short sale in Arizona real estate is selling a property for less than is owned on the property.

For example:
Loan Amount:  $250,000
Market Value of Real Estate:  $200,000

In the above example, the property is upside down a minimum of $50,000.  In order to get the bank to accept an offer at $250,000, a MyOwnArizona team of experts who specialize in negotiations with banks and marketing Tucson or Phoenix short sale properties to the real estate community are needed.

What are the benefits of a shortsale in Tucson or Phoenix?

  • Minimizes Credit Impact
    • Although a Tucson/Phoenix Shortsale does negatively impact one’s credit, it is minimized in comparison to other options such as Foreclosure. This is important as credit impacts so many facets of a person life. For example, many companies look at the credit reports of applicants before making a hiring decision.
    • In Fannie Mae and Freddie Mac’s underwriting bulletins they state that they will back a loan to a Tucson/Phoenix short sale participant in only three years, but people who have a foreclosure must wait seven years.
  • Full settlement on mortgage debt and liens
    • When there are two loans on a property, the second position lender may want to simply release their lien, but retain their deficiency rights keeping the door open for future litigation. An experienced MyOwnArizona Tucson or Phoenix short sale specialist will attempt to negotiate the second lien so the entire note is retired during the shortsales process providing the homeowner with complete peace of mind.
  • Knowing you have done the right thing
    • Many people simply believe it is the “Right Thing to Do” and try to settle their debts in the most cooperative way possible.

Can I stop making mortgage payments?

Lenders and servicers want you to make payments; however, most require that the borrower be in default in order to be eligible for a Tucson or Phoenix shortsale. In addition, the default must be a result of an adverse and unavoidable financial hardship such as loss of job, loss of income, divorce, large medical bills, forced relocation.

If you are not behind on payments it is theoretically possible to conduct a Tucson/Phoenix short sale; however, most lenders require you to be behind on payments to initiate a short sale. In those situations, the lender will look at your finances and they may ask for a promissory note to complete the short sale. We are willing to submit Tucson/Phoenix shortsales while the borrower is current, and simply see what the lender says. If the borrower needs to be in default, the lender typically tells us right away.

Homeowners must be very careful about stopping mortgage payments. In general if you stop making payments and don’t do a Tucson/Phoenix short sale, you will lose the house to foreclosure. It is very unlikely that a homeowner will be able to hold onto the money and catch up on the arrears and reinstate the loan if the short sale is denied.

How long does it take to complete a short sale in Arizona?

Banks can take up to 60 days to give an official approval of an offer once it is received.  This process can be improved by communication with the bank by your representation.  Open and consistent communication is what improves the process.

Ensuring that the required paperwork by the bank is correctly filled out increases acceptance by over 45%.  Some banks will destroy an application that is even off by one item.  Our team ensures that your paperwork is completely filled out the first time so you have the greatest chance at acceptance.

How long do I have until I have to move out?

The bank is required to let you know when they have filed the notice of default with the county recorders office for the county you are in.  The majority of banks do this after you have become 90 days late on your mortgage or 3 consecutive mortgage payments.  From this time the earliest a sale date can be set is 90 days from that date.  So you may not have to move out until days after you have missed your third payment.

What are the consequences of doing a Arizona short sale?

Completing a successful short sale will mean that you will not have a foreclosure reported on your credit.  This will also mean that on lending applications where it asks if you have had a property foreclosed upon you will be able to answer, ‘no’.  This is one of the single best consequences of doing a short sale.  By requesting a short sale with your lender or having a team such as us do this work for you, the number of calls you receive will be reduced by over 50%.

Can I rent my house during a short sale?

Yes – It is your house and you have the right to rent it.

Can I keep the rent and not pay the mortgage?

Yes – you can keep the rent even if you are not paying the mortgage.

Can I rent my house to the potential buyer while the Tucson/Phoenix Short Sale is in process?

This is not recommended. There are liability and eviction issues. The renting of the property will not affect the Tucson/Phoenix shortsale; however, if the short sale is denied and the lender forecloses, the buyer will be forced out of the house.

How can I stop harassing lender calls?

Do not ignore the calls or block the calls. It is best to tell the lender what you are doing. If you have started a Tucson/Phoenix short sale, tell the lender you are doing a Tucson/Phoenix short sale and give them the name of the MyOwnArizona realtor. Tell the lender or servicer to communicate with you strictly through written correspondence only. This will cut down on the calls but it also gives you record of what is being discussed or offered by the lender. Do not throw away the lender letters.

Another option is to send the lender or servicer a “Cease and Desist Letter.” Under the Fair Debt Collections Practices Act, if you send a debt collector a Cease and Desist Letter, the debt collector can communicate only once more via mail indicating what course of action they are going to take. It is important to understand that Cease and Desist letters only apply to debt collectors. Lenders are not debt collectors, therefore, if your lender is making the calls, then they do not have to honor the “Cease and Desist Letter”. However, experience shows that they usually do stop calling and communicate via mail.

How do I know I’m not getting involved in a scam?

Stealing the Deed or Equity Scamming Link

As foreclosures continue to rise across the nation, con artists are taking advantage of unsuspecting homeowners. When you are under financial stress, it is important to look past the smooth talk and appealing promises. The best choice is to thoroughly research the people and companies offering to help you.

Things to watch for:

  • Never pay anyone or any company an up-front fee to conduct a loan modification, arrange a short sale, or stop a foreclosure.
  • Never sign a deed unless you are at a title company and you have a pay-off letter from all your lenders.
  • Don’t let anyone push you to sign a contract immediately; reputable firms allow you time to think about your decision.
  • Beware of anyone who asks you to make them a co-signer on financial documents, particularly those that could affect ownership of your home.
  • Make sure any company you work with is legitimate, with a business address and website. If all you have is an individual’s cellphone number, that is not a good sign.
  • Avoid doing business with someone who “guarantees” they can sell your home or get your loan modified.
  • Beware of any home sale contract in which you are not formally released from liability for your mortgage.

MyOwnArizona are Arizona Short Sale Specialists.  We currently offer our processing services throughout the greater Arizona area.  You may contact us for a confidential interview Tucson area: (520) 822-6575 / Phoenix area: (480) 382-9191 or via email.

Please feel free to contact us and we can provide you with additional information. We look forward to hearing from you and working with you soon!

Our best,
Bob Helmig and Carl Pepper, Realtors

Tucson: (520) 822-6575
Phoenix: (480) 382-9191

Featured MLS Listing: 8760 Newport Place Oro Valley, AZ 85704

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