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Cesi Pagano & Associates is a full-service real estate team and are here for any of your questions. Below learn more about both foreclosures and short sales. If you have any questions at any point do not hesitate to reach out to us by calling or sending us a message. We are always here to help.

If you’re looking specifically for Short Sale information click here.

What is a Foreclosure?

A foreclosure is a legal process in which the lender tries to reclaim the title of a property due to failed mortgage payments by a homeowner. The owner forfeits all rights to the property.

What is the process of a Foreclosure?

A foreclosure happens when the current homeowner is unable to make their mortgage payments due to financial hardship.
After approximately, three to six months of late payments, a notice is sent to the homeowner and the County Recorder’s office. This is referred to as a Notice of Default, which is indicating to the homeowner that they are at risk of losing their home.
The homeowner then is put through a pre-foreclosure process. This allows the homeowner between 30 -120 days to settle the debt or make an arrangement with the lender.
If the homeowner fails to reach the deadline, then the home is put into a foreclosure auction.
The homeowner is allowed to redeem the home, known as the right of redemption if they are able to come up with the money before the home is auctioned.
The homeowner is typically asked or forced to vacate the home, depending on the cooperation of the homeowner.
During the auction, the home will be given to the highest bidding cash buyer.
If the home is not sold to another bidder during the auction, the lender will purchase the home. This is known as real estate owned. In these cases, homes can now be listed by local real estate agents on the open market.
It is advised for anyone considering a foreclosure process to consult with a Tax Adviser/CPA about potential tax implications, a Financial Consultant about credit ramifications, and an Attorney about other potential consequences.

How can a homeowner stop a Foreclosure?

If the homeowner is arrears on mortgage payments, there is still an opportunity to save their home.
Most lenders do not want to go through a Foreclosure because of added carrying costs and additional loss revenue
It is important to communicate with the lender as soon as the homeowner is in financial hardship and unable to make the payments.
Most lenders will agree to a type of compromise to help a homeowner get back on the right track.

What is a Short Sale?

This is a more popular option. This means the homeowner has the possibility to sell their home, subject to bank approval, and negotiates a lower payoff on the loan.

There are two ways to initiate a short sale:

Once the lienholder has filed a Notice of Default but has yet to set an auction date. The owner or their representative can contact the lender and ask to do a short sale.
The owner of the home can recognize they are unable to pay their mortgage going forward, and their representative (Realtor) can coordinate with the bank to short sale the home.

A short sale is when a home is being sold at a purchase price that is less than the current remaining balance of the loan. With a short sale, the lender agrees to accept less than the total owed in exchange for a release of the mortgage as a lien on the property.

It is advised for anyone considering a short sale to consult with a short sale negotiator/Realtor to understand tax and debt liability possibilities.

Cesi Pagano & Associates has specialized in short sales for over thirty years. Cesi and her team have streamlined their systems to make the short sale process a smooth transition.

What is the Process of a Short Sale?

Once the lender accepts a short sale, the receipt can take up to a 10-30 day period.
Then a negotiator will be assigned. From here a broker will give an estimated value of the home known as a broker price option. Potentially, a second negotiator can be assigned.
The lender can request all involved to sign an “arms-length” affidavit. This is basically stating that both parties have no previous relationship, and do not know each other personally.
If the sale is approved, the lender will then submit a short sale approval, or it can happen concurrently with the sale of the home.

To learn further if a short sale is acceptable for you, consult with Cesi Pagano & Associates directly.

Below are the benefits of allowing Cesi Pagano & Associates to assist you:

Free Listing Consultation and Straightforward Guidance
Successfully negotiated and closed over 1,000 Short Sales and Lien Releases
Over 99% success rate
Closed Short Sale transactions in record time
Minimize derogatory credit
Eliminate back taxes and other liens
Specialize in the full release of future deficiencies and liabilities negotiated by attorney
Receive up to $30,000 from the bank (depending on lender and loan)
CDPE Designation, Certified Distressed Property Expert
Pre-Foreclosure Specialist Certification
Short Sale & Foreclosure Resource Certification
Certified HAFA Specialist (Home Affordable Foreclosure Alternative)