In today’s housing market, Wisconsin homebuyers may turn to short sales as a potential way to become homeowners. Short sales are homes that are sold for less than the current owner owes on his or her mortgage. The sale must have the lender’s approval and usually occurs when a homeowner is in financial distress and can no longer make their monthly mortgage payments.
The lender, in an effort to avoid costly foreclosure proceedings, will agree to accept less than is owed on the mortgage. While a short sale can be a good real estate move to get more house for your money, there are potential pitfalls. Whether you are a first-time buyer or even a seasoned buyer, it is advantageous to speak to a knowledgeable Northwoods, WI real estate lawyer.
How Are Short Sales Governed Under Wisconsin Law?
Short sales are primarily contractual and, as such, are governed by state-specific regulations and general real estate principles, detailed in statutes (Chapter 846) and enforced by the Wisconsin Department of Financial Institutions and the Wisconsin Department of Revenue. Wisconsin also offers certain incentives for short sales under programs like the Home Affordable Foreclosure Alternative Program, which provides financial incentives to investors and buyers to encourage short sales.