Foreclosure Defense/Stopping the Foreclosure Sale
Many clients are not familiar with the foreclosure process and learn at the last minute that their home, investment or commercial real estate is set to be sold at a foreclosure sale. Many property owners simply need more time to evaluate their options and create a plan. At SARAGA & LIPSHY, P.A, we understand how to help property owners who are facing foreclosure. It is our goal to educate our clients on all the available options and provide legal counsel that will help each client execute a plan that works best to meet their individual goals.
At SARAGA & LIPSHY, P.A. we have assisted many clients by defending a foreclosure action to achieve a successful short sale resolution
Contact us today for your free consultation to learn more about your rights and remedies under the law.
Short Sale
It is no surprise that the South Florida real estate market is not what it once was. No longer are homes appreciating at the record setting pace of just a short time ago, nor are they selling in weeks, even months. In this economy, many people are left in a situation where they cannot sell their home for what they owe to their lender. This leaves the homeowner with three basic options: 1) wait out the market or sustain large cash losses on the property; 2) allow the lender to foreclose on the home; or 3) negotiate a ‘short sale’ with their lender. SARAGA & LIPSHY represents either sellers or buyers involved in real estate short sales.
What is a short sale?
A short sale is a sale where the mortgage lender agrees to accept less than the amounts owed on the property as part of an agreed sale, rather than having the property foreclosed. The short sale must involve a sale at a fair price based upon an arm's length transaction. There is no requirement that the lender agree to a short sale. The lender considers many factors in deciding whether to approve a short sale such as:
- If the seller is deserving of a break due to financial hardship caused by unforeseen circumstances (layoff, divorce, illness);
- If the short sale loss is less expensive than a foreclosure action to repossess the property, make the necessary repairs and sell the property through a real estate agent;
- How many other properties the lender currently has in default;
- Whether there are co-signors who can be held legally responsible for the balance owed on the mortgage.
Representation of sellers
Frequently, Realtors do not have adequate experience to represent the seller’s legal interests in a short sale. Mortgage lenders often have stringent requirements for disclosures by potential buyers, as well as individual policies specific to any consideration of a short sale. Many times there will be more than one lender involved. Negotiations must be performed with the lender’s loss mitigation departments on behalf of the seller. Frequently, these negotiations will exist simultaneously with a foreclosure action. 
SARAGA & LIPSHY can assist the seller with:
- Short sale of the property
- Lender negotiation
- Sales contract review and Realtor guidance
- Representation of the seller during a foreclosure or exchange of a deed in lieu with the lender, if applicable
Even a short sale or exchange of a deed in lieu can have a negative impact on the seller’s credit, so it is important to have thorough and complete representation during this process
Representation of buyers
If you are the potential buyer of a short sale property, there are many obstacles that the lender’s loss mitigation department will require you to overcome. Loss mitigators sometimes receive bonuses based on how many defaulted loans they can clear up, so they’re more likely to pay attention to your offer if you can show them you’re taking care of as many details and objections they may have as possible. SARAGA & LIPSHY can help you hurdle those objections by:
- Negotiating with the seller’s lender
- Presenting your offer to purchase
- Obtaining a hardship letter from the seller
- Preparing financial disclosures to be submitted to seller’s lender
- Monitoring additional legal actions against the property (such as foreclosure)
- Preparing and reviewing the Settlement Statement or Settlement Disbursement Estimate which should include the following:
- Commissions to real estate brokers
- Buyer’s financing (cash or loan)
- Payments to cover outstanding liens and taxes
- Approximate closing date
- Cash to seller (this should be zero)
- Any other expenses which may raise a red flag
Contact us if you are involved in, or considering, any short sale transactions whether as seller or buyer. At very little cost to you, SARAGA & LIPSHY can add a great deal of value!