The concept of quick house sales arises in cases of defaults and mortgages. In Canberra, you might find a few properties up for a Quick Sale on auctions before an individual becomes a defaulter or reaches the foreclosure stage. It might lead to a lower credit score, but with quick sales, you can get the most out of the grace time that the lenders usually offer to the loan borrowers.
It is a technical concept, and you’ll have to get deeper into it to understand the quick sales concept. In this article, we’ll elaborate on it in detail for you.
Need for quick sales of a house:
Once a borrower defaults on the loan, there is a list of legal processes to handle before the lender can get their money back. It requires extra time and effort from all the parties involved.
Such a problem has led to the creation of a pre-foreclosure period. This period starts after 90 days of the first missed mortgage payment. At this stage, the lender sends a formal letter to the defaulter regarding the pre-foreclosure period.
The loan defaulter can also initiate the pre-foreclosure procedure, but they cannot do it alone. They need the approval and involvement of the lending party in the process of selling the mortgaged house.
Usual practices for a quick sales:
The borrower and the lender usually agree to put the house lower than the market value to get a buyer readily.
Mentioning pre-foreclosure on the property is necessary to provide the buyer with the reasons for keeping prices lower than the market value.
The lender usually approves the quick sale so the property as they consider it a timely method of recovering the loan amount.
Quick sales can provide the last hope for the borrower to pay the default payment. This concept is different from short sales and must not be confused. Another thing to keep in mind is that quick sales can negatively impact your credit ranking. But there are limited options to avoid the foreclosure stage; Quick sale is one of them.