Maryland has one of the highest foreclosure rates in the United States. If you are facing foreclosure, it is important to note that there exist several options and they include Loan Modifications, Short Sales, Deeds in Lieu of Foreclosure, Bankruptcy, the Protection of Homeowners in Foreclosure Act (“PHIFA”), just to name a few. Your solution may include any one, or a combination of the above. Of all of the potential solutions, the Short Sale is perhaps the most preferred by both the borrower and the lender; and certainly the courts prefer short sales as they require no involvement by our already overburdened legal system.
The July 1, 2013 enactment of the Maryland Mortgage Assistance Relief Services Act (the “MARS Act”) must be considered a victory for the powerful lobbyists employed by the banking industry. The MARS Act drives a wedge between the realtors and their sellers whom they have been assisting for years. The MARS Act has also created new disincentives for short sale negotiation services from staying in the Maryland market. Fortunately, law firms who routinely perform Short Sale Negotiation services, such as Staiti & DiBlasio, have been exempted from the many of the MARS Act’s limitations.
What is a Short Sale?
A "Short Sale" is a real estate transaction where the proceeds of the sale will not generate sufficient funds to pay the debt secured by the property (and the seller is unable to pay the difference) and therefore, any creditor(s) with a security interest in the property must consent to receiving less than they are owed in return for releasing any lien on the property. The fact that a creditor may release its lien to allow the property to be sold does not mean that the creditor has or will forgive the deficiency.
Simply stated, a Short Sale occurs when your lender agrees to accept less than the amount you currently owe on your loan and allows you to sell your property, generally to prevent a preempt or prevent a foreclosure.
Don’t let the name fool you. The process is not fast or easy is geared towards allowing your bank to make a calculated business decision based upon whether or not your Short Sale application is in their best interests – usually while you are facing the threat of foreclosure. The July 1, 2013 enactment of the MARS Act has further shifted the balance of power to the banks and in addition to regulating who can assist you, also mandates several Required Disclosures – these are ours:
Our Short Sale Process
The typical (and there is no such thing) Short Sale process requires several months of paperwork, procedures, and telephone conferences. The Short Sale process is generally dictated by the banks and is highly invasive. Again, the banks will be seeking information about you, your income, your credit, your house, and your market - to better allow them to make a calculated business decision based upon whether or not your Short Sale application should be approved. Without guidance and protection, this process has been known to drag on for months and years, and that invariably benefits the banks.
At Staiti & DiBlasio – we represent you, not just as a Short Sale client, but as our client. We start by reviewing your loan document package to determine your potential options. We work hand in hand with you and your realtor to present your Short Sale application to your bank, and then we use our years of legal experience to bolster your application with not just knowledge of your other available options, but the actual ability to implement those options. That’s a difference that only a law firm with attorneys admitted in the state and federal courts of Maryland can provide.
Call Staiti & DiBlasio, LLP for assistance - (410) 787-1123