Short Sale - How to Prevent Losses or Foreclosure by Selling in a Declining Real Estate Market

Miami, FL (PRWeb) March 18, 2007 -- Miami real estate agent Izzy Buholzer offers advice on how homeowners and investors that need to sell their property can cut personal losses and save their credit in a declining real estate market by conducting a "short sale".

"If a declining real estate market has caught you with loans on a property that are greater than the selling value of that property, then you need to take action to protect your credit." A professionally structured Short Sale can help homeowners and investors that need to sell their property to cut personal losses and save their credit in a declining real estate market.

Thus cautions, Miami real estate agent Izzy Buholzer (www.ibmiami.com), who believes that an intelligent way to handle real estate in declining markets is to make a "Short Sale by simply asking the mortgage lender to lower the amount that you owe."

"You have to do the math. If you find that the loans on your property are more than what you could get if you sold the property, then you need to take action in order to cut potential losses or prevent foreclosure." says Buholzer.

Buholzer suggests a seven step plan for making a short sale:

"First you have to know the value of your property," says Buholzer. He explains that "if you are selling the property through a real estate broker, your broker will provide you with an estimate of market value. If you are selling the property yourself, do your own market analysis of the area and your property."

The next step according to Buholzer is to "add up all the costs of selling the property." Buholzer says that if you are using the services of a real estate broker, the broker will provide an estimate of closing costs. If you are selling the property on your own (for sale by owner), then you should call a local title company or real estate attorney and ask, as a seller, what the closing costs will be.

The third step in Buholzer's guide is to "determine the amount owed against the property." This amount is simply the total of all loans against the property.

Once you have the basic information then "you have to do the calculations," says Buholzer.

"Subtract the total amount owing against the property from the estimated proceeds of the sale," he adds. On a short sale, this will be a negative number.

If in fact, your loans are greater than the selling value of the property the next step is to contact the lender or lenders

"Talk to someone in the customer service department and tell them the situation," advises Buholzer. "They may direct you to a specific department. Talk to a supervisor or manager if possible; this person will have more authority."

The sixth step is to ask the lender what its procedures are for a short sale

According to Buholzer, "Some lenders are willing to work with you by reducing the amount owed or making other arrangements. Others will look to the agents involved (if any) or anyone else who's making money from the transaction to see if they are willing to make concessions to make the transaction happen. Still other lenders will tell you that your debt is your responsibility, one way or the other."

The last step is simply to sell the property.

Buholzer also points out more "tips and instructions" on his website (http://www.ibmiami.com/ShortSale.htm) for those who are thinking of doing a short sale.

He says that "If a property is sold under a short sale, the lender may require the buyer to make up the difference, either through a personal obligation or a collection," and warns that "the IRS often gets involved with short sales," because they are seen as a relief of debt and may be treated as income. "Check with your accountant," cautions Buholzer.

"If you follow this simple step-by-step guide you will be able to make a successful short sale on your real estate," concludes Buholzer.

For more information about Short Sales get in touch with an experienced realtor that is familiar with the subject or contact
Izzy Buholzer in Miami directly at
786-287-6999

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