Short Sales and Foreclosure FAQ


Many American families face an uncertain future, as changes in circumstance have forced far too many families to make difficult, life-changing financial decisions. The prospect of foreclosure is a frightening reality for record numbers of homeowners, often through no fault of their own. There is hope, however; with banks reluctant to foreclose, short sales offer an avenue of escape for both the bank and the struggling homeowner. Familiarizing yourself with the process and understanding your options gives you the best chance for a positive outcome. You can find out more about foreclosures and short sales by reading our Short Sale and Foreclosure Guide Below, or by contacting us here.

Are you underwater on your home and would like to:

  • Avoid foreclosure,
  • Sell your home,
  • Owe nothing more on your mortgage,
  • Possibly get CASH BACK (depending on your lender)

Banks are now more willing than ever to work with home owners wishing to short sell their homes.


Call us at 702-592-5090 to get the ball rolling.

Or if you prefer email, click here.

A quick primer on short sales


What is the difference between a short sale and foreclosure?
A short sale occurs when a home is sold for less than what the homeowner owes on the loan. A foreclosure is a legal proceeding wherein the bank retakes possession of a home from the homeowner because of failure to meet the terms of the loan. A short sale is generally not as harmful to the homeowner's credit score, whereas a foreclosure can have an extremely negative effect on the homeowners credit score for many years.

How much will this cost me?
Unlike a normal home sale, short sales do not usually require the seller pay the closing costs, including the agents' commission. Often short sales are facilitated at little or no cost at all to the seller.

How long does the Short Sale Process take?
A typical short sale will take longer to close than your standard home sale. Time frames will vary based on individual circumstances.

What do I have to do?
Very little. We will list your home, personally negotiate with the banks, and handle the paperwork. You will need to provide certain documentation that accurately describes your situation and sign a number of forms. You do not have to be in the Las Vegas area and you will NOT have to deal directly with the bank.

How do I benefit from a short sale?
A foreclosure can have a severely negative effect on your credit score for up to seven years. Short selling your home can help you avoid this, which may put you in a better position to purchase a home in the future. It will also allow you to avoid the foreclosure process which can sometimes feel dehumanizing and humiliating.

Why do banks agree to sell homes for less than is owed on the loan?
The foreclosure process is not an easy one, even for lenders. It is a legal proceeding that can tie up attorneys and can often be very expensive for the lender. When the process is complete they still end up with a home that they need to sell. This requires more effort and the toxic asset they desperately want to get rid of is still on their books. Short sales offer lenders a way out of this process and often costs them less than foreclosures.

What about deficiency judgments and legal ramifications?
Deficiency judgments occur when a junior lien holder sues the borrower for the remainder of the balance owed. Unfortunately many realtors neglect to address this possibility, which puts some home owners at risk. We take a different approach. As part of our negotiation process we aggressively pursue waivers to any and all deficiency judgements.

What seller qualifications are there for a short sale to be accepted by the banks?
As, we have said before banks do not want to go through the foreclosure process any more than homeowners. However homeowners must meet certain criteria to be considered for a short sale.

  • Financial Hardship A situation, such as loss of a job, death or divorce is causing the homeowner to have trouble affording the mortgage.
  • Monthly Income Shortfall A lender will want to see that the homeowner either cannot now afford their mortgage or will not be able to in the near future.
  • Insolvency Lenders often look to see that the homeowner in distress has little or no liquid assets (cash in the bank) to pay down their mortgage.

Do I have to be behind on my payments to negotiate a short sale?
Homeowners that feel they are about to fall behind on their payments should consider their options quickly. Remember banks are looking to see that there is a monthly income shortfall, financial hardship or insolvency. Everyone's situation is unique, please call us today at 702-274-1068.

What about renting my home?
If you can cover your mortgage payment by renting out your home that option is available and it could even keep you out of foreclosure. (Provided you catch up on any missed payments and make all payments going forward). We can guide you through the process of finding a renter, checking their background and writing the contract. (Note: Some lenders prohibit the borrower from renting the property so verify first!)

I still need a place to live!
It is important to consider that after all is said and done with the short sale, you're still going to need a roof over your head. The earlier this is planned for, the better off you will be. We can help you sort through the thousands of rentals listed, so you can find a place that best suits your needs and your budget.

Are there buyers out there interested in short sale properties?
Absolutely! In many markets homes are put under contract in a matter of days after being listed. Many short sales receive multiple offers in a short amount of time. Though short sales are not as easy to close as a regular home sale, they are certainly not impossible. RoadDogGroup.com and it's partners are experienced in short sales and knows how to work with the lenders to get them closed.

Is there enough time to negotiate a short sale before foreclosure?
The foreclosing party (usually the lender) can stall the foreclosure process right up until the final day. Often all it takes is a call from an attorney or real estate agent to stall the process. Most lenders will also stall the foreclosure process with a legitimate contract (an offer on the home). There are no guarantees though and the sooner the short sale process is started, the better chance it will be accepted and closed.

What about the embarrassment that comes with listing a short sale?
The ugly truth of the matter is that one in five homeowners in the US is in a similar situation. Homeowners facing foreclosure are not alone and should not feel ashamed of being caught in economic tides they have no control over. Lets not worry about embarrassment, let's just get this fixed.

Avoiding Foreclosure
Letting foreclosure run its course can have seriously negative effects on a person's ability to get a mortgage, a security clearance or even a job. Short selling can be a way to avoid many of the lingering effects of foreclosure.

How do I get started?
Call us at 702-592-5090 to get the ball rolling. There is no obligation and we will happily answer any questions you may have.

What are some of the effects of going through a foreclosure?


Your credit score takes a big hit
The effect will vary depending on the bureau but you can expect to lose between 250 and 300 points on your credit score. With a short sale that number is closer to around 50 points. (provided all other payments are being made)

Fannie Mae Backed Loans
Expect to be blocked from getting a Fannie Mae backed mortgage for up to five years after a foreclosure, seven years for an investment mortgage. There is still a limitation after a short sale, but it is only two years for both owner occupied and investment mortgages.

Higher Rates On Future Mortgages
On future loan application a perspective borrower will have to answer "Yes" when asked "Have you had property foreclosed upon or given title or deed in lieu thereof in the last 7 years?" That yes answer can result in higher rates as the lender works to offset the risk. There is usually no similar question required for short sales.

Credit History
A foreclosure can remain as a public record on a person's credit history for 10 years or more. Your credit history is referred to by potential lenders, landlords, and employers.

Security Clearances
A side effect of foreclosure that some do not consider is it's potential effect on security clearances. Next to a felony or serious misdemeanor it can be the most challenging issue against a security clearance. Members of the military, law enforcement, security firms and intelligence agencies may have their clearances revoked over a foreclosure which could result in termination. Short sales generally do not challenge most security clearances.

Current Employment
Employers often include a credit check as part of their overall background check on their employees. For those who are in sensitive positions, a foreclosure may result in reassignment or even termination.

Future Employment
Many employers, especially in today's difficult job market, are doing credit checks on all employees and potential new hires. A foreclosure can therefore be a serious challenge to employment. Short sales may show up on a credit report, but are generally not considered as damaging.

The Bottom Line
The bottom line is foreclosure comes with a vast array of negative consequences: a drastically lower credit score, challenges on employment and security clearances, limits on the types of mortgages available and the intangible but no less real emotional stress on homeowners.

DON'T GIVE UP! There are options available and RoadDogGroup.com can help you find the solution that best fits your particular situation.

Are you underwater on your home and would like to:

  • Avoid foreclosure,
  • Sell your home,
  • Owe nothing more on your mortgage,
  • Possibly get CASH BACK (depending on your lender)

Banks are now more willing than ever to work with home owners wishing to short sell their homes.


Call us at 702-592-5090 to get the ball rolling.

Or if you prefer email, click here.

The data relating to real estate for sale on this web site comes in part from the INTERNET DATA EXCHANGE Program of the Greater Las Vegas Association of REALTORS MLS. Real estate listings held by brokerage firms other than this site owner are marked with the IDX logo. GLVAR deems information reliable but not guaranteed. Copyright 2004 of the Greater Las Vegas Association of REALTORS MLS. All rights reserved.