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Swimming alone in the deep waters of financial distress will sometimes make us want to bury our head in the sand and hope all of our problems will all go away. This doesn't usually work, however, so if you are in this position you need to take action!
One of the first steps you want to take is to call your lender directly. While it is human nature to want to avoid any contact from the mortgage company, your lender should be your first call because they will have as much interest as you do when it comes to avoiding foreclosure. The lender will be open to working with you through a mortgage modification if you qualify.
When the numbers don't work and modification is not an option, the second phone call you may want to make is to an attorney. An attorney will help you with all of the legal ramifications contained within the options that are available to you. While your choices may not be pleasant, your attorney can assist in choosing which will work best for you given your financial predicament.
So let's recap, you have stopped ignoring the issue and took some action. Let's say the result of that action is that your lender cannot make the modification work and your attorney advises you to sell the property before you lose it to foreclosure. At this point, you probably fall within one of two categories: you have time to list with an agent or you do not.
If you do have time to sell your property, find an agent to list your property on the MLS for you. While it is tempting to want to save a few bucks and sell the property on your own, you will soon find out that you are actually losing both time and money as your property sits unsold.
A few years back during the seller's market, property values were trending upward and the mindset of the buyer was "if I don't buy today, it's only going to cost me more tomorrow." What do you think the mindset of the buyer is in today's current buyer's market that continues to trend downward?
So you get the point, there is no sense of urgency for the buyer today - list the property if you have time, price it properly, and force that potential buyer to think twice about waiting until tomorrow when the property may be cheaper. You will get the most exposure for your home working with an agent. The more exposure you get for the property, the more buyers you attract, the more buyers you attract, the higher your potential sale price.
But what if you don't have time? As discussed above, an agent is a necessary asset when looking for the highest and best retail price the market will bear for your type of property. When time becomes an issue, however, your best asset is a real estate investor.
So what exactly is an investor and how can they help you when time is an issue? In short, like a lender, an investor turns money over for a profit. Whether the investor chooses stocks, funds, bonds, pork bellies, or real estate, the same rules on Wall Street apply on Main Street - buy low, sell high.
While an investor may sometimes utilize some of their own money to purchase a property, a good investor will use someone else's funds for the majority of their transactions. These funds come from a variety of different sources such as cash and credit lines, as well as several different types of lenders - private, conventional, and hard money.
The direct access to money allows the investor to move quickly on a real estate transaction and this is the main benefit for you when you need to sell fast - your buyer is here right now ready to purchase. If time is your issue, then a real estate investor is your solution.
The transaction between the seller and the investor is a two-way street, just like it would be with any other type of transaction. The two parties to the contract must see a benefit to entering into the transaction. In this case, as a seller in financial distress, you need to be relieved of your property burden without losing your shirt. While the investor will want to acquire the property at a price low enough to mitigate the risk associated with fixing up and re-selling the property.
Once that point is reached, we will then have ourselves a mutually agreed upon and fully executed contract to purchase and sell real estate.
Take action on your real estate issue: a successful transaction hinges on your management of both time and money. Your lender, attorney, agent, and investor are standing by to help guide you. The situation will dictate the real estate professional that is best suited to help you - an agent will spend more of your time but net more money for your property, while an investor will save you time but net less money for your property.
Kevin Sullivan is an active real estate investor and owner of Premiere Asset Solutions.
Disclaimer: All information on this site is provided for informational purposes only! By no means is any
information presented herein intended to substitute for the advice provided to you by any health care or other professional
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