Short sales don’t just hit normal everyday homeowners. Utah Senator Mike Lee had to sell his $1.1 million house in a short sale, Reuters reports.
- Sen. Mike Lee
They are now living in a rental home in Alpine, Utah. The same city they used to live in their “dream home”.
As the housing crisis took hold, Lee’s neighbor’s home went through a short sale, making other neighborhood homes lose value. From that, his own home dropped value and he was forced to short sell. The new buyer paid about $720k for the $1.1 million home.
A short sale occurs when the borrower can no longer pay the amount owed on their property due to economic, financial, or other hardship. The Lender agrees to sell the property as a short sale for a moderate loss because it allows them to avoid foreclosure, and other fees. It’s the only way for a property owner to get out of an underwater mortgage.
Sometimes though, a lender will not always forgive or release an owner from the money lost or other liabilities. That’s why it’s always a good idea to have an experienced real estate attorney who can negotiate a great deal. It can be tricky.
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