Homeowners that may have a second lien on their home often worry about their options when they decide that their underwater mortgage is too much trouble and they want to short sell their home. A short sale can be an easy way for a homeowner in a bad mortgage position to get out from under their underwater mortgage without suffering too much damage to their credit score.
Many homeowners were simply walking away from their mortgage, which does a lot of damage to one’s credit score, or homeowners that wanted to short sale were simply unable to do so because a second mortgage holder might have been unwilling to go along with the sale. However, incentives were being offered for second lien holders in order to entice them to work with primary mortgage holders in short sales on underwater homes.
A short sale is not something that is easily accomplished, but many feel that it is much more beneficial for a bank to help a homeowner short sale their home rather than foreclose. One reason for this is that if a homeowner and their bank are working to find a buyer for a home then the bank will be able to start collecting on a new mortgage faster than if they went through the foreclosure process.
Homeowners who have an underwater mortgage and may want to short sell their home should talk with their lender about what options or procedures they must take in order to make this happen. While there are some second lien holders who may be unwilling to work with homeowners, short sales are becoming more of an option for homeowners that are in a bad underwater mortgage situation and are trying to get out of their mortgage commitment without simply walking away.
Lenders are being pressed to do more to help homeowners avoid foreclosure, and it’s for this reason that homeowners may stand a better chance if they talk with their lender about working to short sell their home so that they can avoid foreclosure and get out of an underwater mortgage.