When you talk to an attorney about short selling your house, very often one of the main reasons that he will give you for using him instead of a licensed Realtor® is the Real Estate Agent's lack of education and experience. NOTHING could be farther from the truth.
As we all know, short sales have pretty much been the norm for the last 5 - 6 years or longer. Because of this trend the Real Estate Agent has worked almost exclusively with these distressed properties. In addition to these many years of working in this area, he or she is required to take a minimum of 12 hours of continuing education classes in order to keep their license active. In addition, many of the major lenders conduct seminars and webinars to continually keep the agents informed on their short sale processing as well as new state and federal guidelines and laws concerning short sales.
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A Realtor® is discouraged from charging the client an up-front fee to initiate the short sale process as the homeowner is now being charged a fee for services that have not been rendered. Are there any fees? Absolutely. These fees are called different thing by different brokerages, but all mean basically the same thing, and that is that there are storage and documentations fees, but do not need to be collected until the short sale is closed, and are collected if the short sale is closed. The attorney on the other hand skirts this by telling the homeowner that this fee, usually $3000 - $4000 is a retainer fee (normally non-refundable, by the way), and that any other fees associated with the transaction will be extra. Now, having said that, are there brokerages that charge a fee up-front or in addition the above stated fees? Probably, but maybe their broker is an attorney.
As a quick side note, it is worth noting that HOA dues are separate from the short sale transaction. Even though the homeowner has not been making the mortgage for several months, it is in his best interest to stay current with the HOA. The HOA can and will lien the property, and in so doing that $35 per month or whatever it is can soon become a bill for as much as $10,000 - $14,000 as a result of all fees going to the attorney representing the HOA. It goes without saying, STAY CURRENT WITH THE HOA.
My final thought would be this. As a Realtor®'s, when we list a property for short sale, one of the main considerations that we have is that we want to prevent foreclosure and/or bankruptcy. Unless the homeowner waits to long to initiate the short sale process, avoiding foreclosure can become real. If on the other hand the homeowner decides that bankruptcy is the only out, (that is seldom the case), then he or she needs an attorney. That is another fee most likely.
Can you buy another home immediately after short selling your home? Possibly, but that will most likely be done through what is called a "hard money lender" The interest rate is typically somewhere around 10% - 14%.
My final-final thought. There really is only one person who can repair your credit and that is you. The hit to your credit as a result of a short sale is typically much less than the hit your credit takes as a result of foreclosure and/or bankruptcy.
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