Short sale. What is all the buzz about? This is an unfortunate and rapidly growing phenomenon that many homeowners are currently asking and wondering about. Is it something that can help me?

What is a 'short sale?? It is a negotiation between a homeowner and their mortgage lender. Briefly, the bank agrees after a lot of communication, and a myriad of paperwork to qualify your hardship. Once you provide the lender with the documentation required it is reviewed and decided whether your request will be accepted into the ?Short Sale Program?. Then the lender will decide ? if ? they will negotiate the loan, and ? how much ? of the loan amount would be an acceptable settlement. The settlement amount is called the 'discounted' amount.

Pros: Subject to the lender's approval it can alleviate and possibly forgive the homeowner of some or all of their indebtedness.

Cons: There could be tax consequences. It can affect your credit standing. In certain instances you can still be held liable if a balance remains when it is all said and done.

This is in no way an easy out. It is an investment of time. It can be a lengthy process. The lender requires a package to be completed, along with the documentation they request. Then you 'hope' for the best.

What is a homeowner to do? CONSULT, CONSULT, CONSULT.

If you are facing financial difficulties you have tough decisions to make. Time is of the essence. Don't let time and the possibility of solutions slip away. Tackle the problem immediately. There are far to many families experiencing financial troubles today. Whether it is due to the lax lending practices of recent years past or changes in life circumstances, the fact remains true.

Consult with your mortgage lender. Do not ignore the problem. The sooner you act; the sooner help may be available. Don't loose the window of opportunity to explore 'loan workout solutions?, which your lender may provide. Ask about possibly modifying or renegotiating the terms of the original loan. If keeping the home is not an option discuss alternative options with your lender, such as assumption, sale of the property, pre-foreclosure sale or short sale payoff.

Foreclosure is expensive. Lenders want to help borrowers keep their homes.

Consult with an accountant and lawyer in regard to tax and or legal implications, depending on your circumstances.

Consult a Realtor. Discuss whether there is enough equity and most importantly time for a quick sale. Bear in mind that property values have declined and therefore has resulted in a lose of equity. Present market conditions may not support what you need monetarily. Depending on your circumstances you may have to bite the bullet and consider cutting your loses, rather than losing your home, in order to move on and begin to rebuild your life and finances.

If you feel you are not ready to speak with your lender here are additional avenues to pursue to help you take the first step. Contact a HUD approved housing counselor, to find one near you call 1-800-569-4287. Additional HOTLINES: Nationally 1-888-995-HOPE, through Homeownership Preservation Foundation. Locally 559-234-1492, through NHLB, No Homeowner Left Behind. By Internet you can go to www.fha.gov, and www.nohomeownerleftbehind.org for advice, guidance, and valuable information about foreclosure preventions options.

The days of double-digit appreciation and creative financing, which was all too easy to acquire, belong to yesteryear. As this unfolds and where it will bottom out, is all speculative. Basically it is a necessary correction, which we will have to work through. Like the stock market, our local real estate market will level out and bounce back. Real estate still remains one of the best and safe investments when handled with prudence. This is today's real estate reality.

By Marge Hernandez, Realtor

Century 21 Jordan-Link & Co.

If this information has helped you in any way, let me know of your experience. If you have any questions or need the services of a Realtor contact me by e-mail, Marge.Hernandez@century21.com or call me direct (559) 688-2100 Ext. 216. Qualified Realtor with the Tulare Redevelopment Agency. Certified Realtor with the Visalia First Time Homebuyer Program.

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