Short Sale Calculator

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Short Sale Calculator
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Are you tired of being a homeowner and want to sell your house? Do you owe more on your mortgage than your house is worth? Have no fear, the Short Sale Calculator is here! But don’t worry, we won’t make you do any math. We’ll do it for you!

Introduction

Short Sale is a process where a homeowner sells their home for less than the amount owed on the mortgage. The Short Sale Calculator is used to determine the amount that the homeowner will receive after the sale. If you’re new to the Short Sale process, you’ve come to the right place. The Short Sale Calculator is perfect for anyone who wants to sell their home but is not sure about the amount they will receive after the sale.

Short Sale Calculation Formula

Here’s the formula for calculating Short Sale:

Short Sale = Mortgage Balance - Sale Price - Closing Costs

Categories/Types/Range/Levels

The Short Sale Calculator has three types of categories or ranges, which are mentioned below:

Equity

If you have positive equity, it means that you will receive a check at closing, and the Short Sale Calculator will show you the amount of the check.

Zero Equity

If you have zero equity, it means that you will break even at closing, and the Short Sale Calculator will show you the amount of money you will receive.

Negative Equity

If you have negative equity, it means that you will owe money at closing, and the Short Sale Calculator will show you the amount of money you will owe.

Examples

Here are some examples of Short Sale calculations for different individuals:

Homeowner Information Mortgage Balance Sale Price Closing Costs Short Sale
John $300,000 $250,000 $20,000 $30,000
Jane $200,000 $190,000 $15,000 $5,000
Jim $150,000 $100,000 $10,000 $40,000

The Short Sale Calculator calculated the Short Sale amount using the formula provided earlier.

Calculation Methods

There are different ways to calculate Short Sale, and the Short Sale Calculator uses the three most common methods. Here they are:

Automated Valuation Model (AVM)

This method is quick and easy, but it may not account for unique characteristics of the property. The accuracy level is moderate.

Broker Price Opinion (BPO)

This method uses a professional opinion, but it may not account for unique characteristics of the property. The accuracy level is moderate.

Appraisal

This method is the most accurate, but it is also the most expensive. The accuracy level is high.

Evolution of Short Sale Calculation

The Short Sale Calculator is a modern tool that has evolved over time. Here’s a brief history of the evolution of Short Sale Calculation:

Year Advancements
2007 The Mortgage Forgiveness Debt Relief Act was passed
2009 The Home Affordable Foreclosure Alternatives (HAFA) Program was created
2012 Short Sale Processing Times Improved

Limitations

Like any other calculator, the Short Sale Calculator has some limitations. Here are some of the limitations:

  1. Incorrect Information – The Short Sale Calculator is only as accurate as the information provided. If you provide incorrect information, the calculator will give you incorrect results.
  2. Inaccurate Property Valuation – The Short Sale Calculator relies on property valuations, which may not be accurate. If the property valuation is incorrect, the calculator will give you incorrect results.
  3. Closing Cost Estimations – The Short Sale Calculator may not provide accurate estimations for closing costs. If the closing cost estimations are incorrect, the calculator will give you incorrect results.

Alternative Methods

Here are some alternative methods for measuring Short Sale calculation and their pros and cons:

Method Pros Cons
Foreclosure No Short Sale Required Negative Impact on Credit
Deed in Lieu of Foreclosure No Short Sale Required Negative Impact on Credit

FAQs

Here are the answers to some of the most commonly asked questions about Short Sale:

  1. What is a Short Sale? – A Short Sale is a process where a homeowner sells their home for less than the amount owed on the mortgage.
  2. Can I sell my home without a Short Sale? – Yes, you can sell your home without a Short Sale if you have equity in the property.
  3. Do I have to pay taxes on the amount forgiven in a Short Sale? – It depends, but the Mortgage Forgiveness Debt Relief Act may exempt you from paying taxes on the forgiven amount.
  4. Can I buy another home after a Short Sale? – Yes, but you may have to wait a certain amount of time before you can qualify for a new mortgage.
  5. What happens if I miss a mortgage payment during the Short Sale process? – It may delay the Short Sale process or lead to foreclosure.
  6. Do I need to hire a real estate agent for a Short Sale? – It’s highly recommended to hire a professional who specializes in Short Sales.
  7. Will I receive any money from the Short Sale? – It depends on the amount owed on the mortgage, the sale price, and closing costs.
  8. Can I negotiate the Short Sale with my lender? – Yes, you can negotiate with your lender to get the best possible outcome.
  9. How long does the Short Sale process take? – It varies, but it can take several months to complete.
  10. Do I need to continue making mortgage payments during the Short Sale process? – It’s recommended to continue making mortgage payments until the Short Sale is completed.

References

If you’re interested in learning more about Short Sale, here are some reliable government and educational resources that you can use:

  1. The Mortgage Forgiveness Debt Relief Act and Debt Cancellation – IRS.gov – This resource provides information on the Mortgage Forgiveness Debt Relief Act and how it can impact your Short Sale.
  2. Home Affordable Foreclosure Alternatives (HAFA) Program – HUD.gov – This resource provides information on the Home Affordable Foreclosure Alternatives (HAFA) Program, which is designed to help homeowners avoid foreclosure.
  3. Short Sale – Federal Trade Commission – This resource provides information on Short Sales and how to avoid scams related to Short Sales.

So, there you have it – everything you need to know about the Short Sale Calculator!