Questions & Answers

Q: Do I need to consult with an attorney?

A: Yes, we recommend that you speak to an attorney and our attorneys are available for you to speak to free of charge at any time.


Q: What is a short sale?

A: Simply put, a short sale is when a home owner owes more to the bank than the current value of their home. An example would be a home owner that owes $400,000 on their existing home and the current market value is $300,000. Joe Knows team will evaluate your situation, do a Market Analysis on your home, list the home, receive and negotiate contracts for market value of the home. They will then submit all the documentation to the bank to negotiate with the bank on the seller’s behalf. “We take care of everything for you; you don’t need to do a thing.” Click here to see if you qualify with a free 30 minute consultation from our legal team.


Q: What if I have more than 1 mortgage on my home?

A: A majority of our short sales have more than 1 mortgage on their home and we will work with both banks or multiple banks on your behalf.


Q: What is a hardship?

A: A hardship can be many different things/events or a combination of things/events . It can be divorce/separation, job loss, relocation, illness, injury, medical issues, an increase or adjustment in your existing mortgage payment, increased living expenses, etc. There are many, many reason a home owner could have a hardship. See if you qualify.


Q: What is the difference between a foreclosure and a short sale?

A: There is a huge difference between a foreclosure and short sale. First and foremost, a just because the bank forecloses on your home doesn’t mean you don’t owe them the money anymore. They will come after you for the money. Typically, a foreclosure will lower your credit score by at least 200 points. If you have a 700 credit score, it could drop to a score below 500 with a foreclosure. It will also remain on your credit history for 7-10 years.

A short sale is a much better solution than a foreclosure. All of our short sales are negotiated by our legal team as settled debts with no deficiency judgments. “Beware of Realtors who are no doing this for you, It will come back to haunt you.” A short sale will could lower credit score approximately 50-80 points and remain on your credit for up to 2 years.

Let’s recap: “foreclosure bad, short sale…way better alternative.”


Q: How does a foreclosure affect my credit?

A: A foreclosure can damage your credit score beyond 200 points and for a period of 7-10 years. Need help repairing your credit? Click here.


Q: How does a short sale affect my credit?

A: A short sale could lower your credit score approximately 50-80 points and remain on your credit report for up to 2 years. Need help repairing your credit? Click here.


Q: Do I need to be behind on my payments or miss any payments?

A: No, not necessarily. It all depends on the bank. Approximately 50% of our short sale clients have been on time with their mortgage payments. This depends on each situation. Everyone is different and they have their own unique situation. Click here to see if you qualify.


Q: How long does it take?

A: It takes approximately 4-6 months on average to get an answer and go to settlement on a short sale. Check our expectation section for a timeline of what to expect.


Q: What if there is damage to my home?

A: This could critically affect your short sale. Call us immediately to discuss.


Q: Should I use a realtor who is certified in short sales?

A: Absolutely, this doesn’t mean someone with a certification is good at short sales or a short sale specialist. Ask you agent about their short sale experience. We are certified and have been doing them for years. We have been on the cover of The Washington Post, National Public Radio, CBS Radio and AOL Real Estate to name a few.


Q: What are the tax implications?

A: Call us for recommended accountants. Depending on your specific situation there may be no tax liability. This is the case in a majority of our short sales.


Q: What information do I need to give you to submit to the bank on my behalf?

A: You will need:

  1. A hardship letter.
  2. Tax returns for the past 2 years.
  3. 2 most recent months bank statements.
  4. 2 most recent paystubs.
  5. Letter of Authorization (LOA) for us to speak to the bank on your behalf.
  6. Current mortgage amount statements.
  7. Financial statement (1 page summary of your financial situation with income and expenses).

Q: What is a deficiency judgment?

A: A deficiency judgment is when the bank has a judgment against you for the difference of what is still owed on the home. An example would be you owe $400,000 on the home and there is a contract for $300,000 and the bank files a judgment against you, the seller, for the $100,000. So you still owe the bank a hundred grand. Again, our legal team negotiates all of our short sales as settled debts with no deficiency judgements.


Q: What if I have mortgage insurance?

A: This is the same as having a second or third trust (mortgage) on your home. We will negotiate it with the mortgage company.