In real estate, a short sale occurs when a bank or mortgage lender agrees to discount a loan balance due to an economic hardship on the part of the mortgagor (i.e., the seller). Circumstances determine whether or not banks will discount a loan balance. These circumstances are usually related to the current real estate market climate and the individual borrower's financial situation. A short sale typically is executed to prevent a home foreclosure. Often a bank will choose to allow a short sale if they believe that it will result in a smaller financial loss than foreclosing.
An arms-length or short sale affidavit is a document created by a bank in an attempt to prevent sellers from selling to relatives or friends to act as a straw buyer. Sometimes sellers make such side agreements. Then, after the transaction closes, the pretend buyers quickly transfer title back to the seller. This practice, in affect, means the sellers have repurchased their home at maybe half the cost, which greatly benefits those sellers.
The Wake North Carolina Short Sale or Arms Length Affidavit is an important document used during a real estate transaction, specifically in the context of a short sale. This affidavit helps to ensure that the sale is being conducted at arm's length, meaning there is no conflict of interest or collusion between the parties involved. The affidavit guarantees that the buyer and seller are not related or have any undisclosed relationships that may compromise the transaction. In Wake County, North Carolina, there are different types of short sale or arms length affidavits that may be used depending on the specific circumstances of the sale. Some of these affidavits include: 1. Standard Short Sale Affidavit: This is the most common type of affidavit used in a short sale transaction in Wake County. It confirms that the buyer and seller have no familial or business relationships that would influence the sale price or terms. 2. Investor-Owned Property Affidavit: In cases where the property being sold is owned by an investor or a company, this affidavit is used to ensure that there are no undisclosed relationships between the parties involved that could affect the transaction. 3. Distressed Property Affidavit: This type of affidavit is utilized when the property being sold is in a state of distress, such as facing foreclosure. It reaffirms that the buyer and seller are unrelated and that the transaction is not a result of any fraudulent activity. 4. Non-Occupant Seller Affidavit: If the seller of the property does not currently reside in the home, this affidavit ensures that there is no hidden agreement or coordination between the buyer and seller that could compromise the transaction. 5. Lender-Specific Affidavits: Some lenders may require additional specific affidavits to be signed by the buyer and seller as part of their own internal processes. These affidavits vary and are unique to each lender's requirements. When engaging in a short sale transaction in Wake County, it is crucial to ensure that the appropriate short sale or arms length affidavit is used, as this will help protect all parties involved and provide transparency in the transaction. It is advisable to consult with a real estate professional or attorney to understand which specific affidavit is necessary for your transaction, as well as to ensure compliance with local and state laws.The Wake North Carolina Short Sale or Arms Length Affidavit is an important document used during a real estate transaction, specifically in the context of a short sale. This affidavit helps to ensure that the sale is being conducted at arm's length, meaning there is no conflict of interest or collusion between the parties involved. The affidavit guarantees that the buyer and seller are not related or have any undisclosed relationships that may compromise the transaction. In Wake County, North Carolina, there are different types of short sale or arms length affidavits that may be used depending on the specific circumstances of the sale. Some of these affidavits include: 1. Standard Short Sale Affidavit: This is the most common type of affidavit used in a short sale transaction in Wake County. It confirms that the buyer and seller have no familial or business relationships that would influence the sale price or terms. 2. Investor-Owned Property Affidavit: In cases where the property being sold is owned by an investor or a company, this affidavit is used to ensure that there are no undisclosed relationships between the parties involved that could affect the transaction. 3. Distressed Property Affidavit: This type of affidavit is utilized when the property being sold is in a state of distress, such as facing foreclosure. It reaffirms that the buyer and seller are unrelated and that the transaction is not a result of any fraudulent activity. 4. Non-Occupant Seller Affidavit: If the seller of the property does not currently reside in the home, this affidavit ensures that there is no hidden agreement or coordination between the buyer and seller that could compromise the transaction. 5. Lender-Specific Affidavits: Some lenders may require additional specific affidavits to be signed by the buyer and seller as part of their own internal processes. These affidavits vary and are unique to each lender's requirements. When engaging in a short sale transaction in Wake County, it is crucial to ensure that the appropriate short sale or arms length affidavit is used, as this will help protect all parties involved and provide transparency in the transaction. It is advisable to consult with a real estate professional or attorney to understand which specific affidavit is necessary for your transaction, as well as to ensure compliance with local and state laws.
