Phoenix Arizona Hard Money Lender
Simply put, a Phoenix short sale is the process of selling your home for less than you owe the lender. For example, if you owe $200,000 on your home the the market value of your home is $150,000, a short sale agent might list the property for sale and receive an offer of $150,000. Ultimately, the bank is “shorted” about $50,000 in the deal, but that is not all bad for them.
In this process, the bank or lender will forgive that debt and allow you to live rent-free in the home until the Phoenix short sale is processed. Why on earth would a bank allow this, you ask? Read on to find out.
Many times, it seems that only the homeowner benefits from a short sale because they are forgiven some of their debt. However, this is not always the case. The bottom line is that, for a bank, a short sale on your part is much cheaper than a foreclosure on their part. A typical foreclosure will cost a bank at least $15,000, often up to $30,000. The fees incurred during a foreclosure include legal fees, maintenance costs, utilities, real estate fees, etc.
Another thing to consider is that banks are not in the real estate business. Yes, they want to lend you money for your home, but that does not make them experts on buying and selling real estate. So, another benefit for the bank of a Phoenix short sale is that the home has already been purchased and now they have one less home in their inventory.