The Moral Short Sale Dilemma
Are you considering short sale, but torn thinking it may be the most ruinous personal and financial decision you will ever make? You are not alone. As more families are confronted by upside-down real estate values, jobless or with limited income, the short sale question is daunting. To many, it is a moral choice.
I am not discussing “strategic short sales”, meaning those who can afford to pay their mortgages but choose to dispose of their property due to negative equity. I am talking about homeowners or investors who have spent most of their savings or drained their retirement accounts to keep their payments current. Homeowners in Florida are some of the most affected in the United States. According to the Mortage Bankers Association: “Twenty-four percent of all mortgages in the country that are in foreclosure are in Florida and 23 percent of the loans in Florida are anywhere from one payment past due to in foreclosure.”
I’ve spoken to Destin Florida investment property owners who are devastated that they might have to stop paying their mortgage, or have already, to save their family’s ability to keep their primary shelter, health and sustenance. Especially for an older borrower, with even more remote job prospects, the emotional turmoil is great.
I can understand why the majority of homeowners are emotionally affected by deciding to do a short sale. Many have stellar credit, and have been stable workers their entire lives. They question their self-image when challenging a core tenet of their being. They feel there is a social stigma to short sale. It is hard. The only words of comfort I can give are for them to understand:
1. You are not alone.
2. You must decide whether you can continue paying your mortgage and still be able to protect your family’s primary needs.
3. You must try to think of a short sale as a business decision, not a personal decision.
The most difficult, but helpful hurdle to overcome is removing “personal” from short sale. Did you know that businesses short sale real estate all the time to keep afloat? Consider this, even the Mortgage Bankers Association, which touts home ownership, sold its own commercial property as a short sale. And recovery from a short sale can be quick if there is a settlement and credit is good in other respects.
If you are about to fall behind on your mortgage, or already have, take action now and stop the pain. Call your lender and try to work it out. Consult with a Florida attorney. Consider your options. If you decide to pursue short sale, it may be the solution that allows you to move forward with dignity.
Wendy Rulnick, Broker, Rulnick Realty, Inc.
Call 850-650-7883 ext 204
Email Wendy: [email protected]