Any real estate attorney who helps homeowners and lenders reach agreement on the terms of short sale are known as a short sale lawyer. Short sales occur when a lender agrees to allow a homeowner to sell a property for less than the balance owed on the mortgage. Typically, short sales occur in places where depreciating home prices mean that mortgage debts exceed current property values.
A short sale lawyer must graduate from college or university before attending law school. Having successfully graduated from law school, a prospective short sale lawyer must pass the bar exam to become a practicing lawyer. Most short sale lawyers begin by focusing on cases related to real estate before specializing on short sale transactions. Law firms that handle real estate cases hire large numbers of law school graduates. Established real estate lawyers often leave major firms and start their own private law firms.
Lenders hire lawyers to draw up short sale agreements that specify the conditions of the sale. Laws relating to real estate transactions vary from country to country, and even among states and territories within a particular nation. Consequently, major banks hire teams of short sale lawyers who are familiar with laws in all areas that the bank operates. Lawyers normally receive a flat fee for the consultancy and document preparation necessary to complete a short sale.
Homeowners hire short sale lawyers to represent their interests during the short sale process. Lawyers representing the homeowner ensure that the all the terms and conditions of the short sale agreement are thoroughly explained to the homeowner before the sale occurs. The lawyers representing the homeowner and the lender attempt to negotiate the best possible terms for their clients, and in some instances short sales fall though when an agreement cannot be reached.
In some areas, lenders can pursue borrowers for the remainder of the mortgage debt after the short sale is executed, while in other places non-recourse laws mean that a lender cannot pursue a borrower for any portion of a debt that remains unpaid as the result of a short sale. Lawyers representing borrowers in areas with non-recourse laws ensure that the short sale contract does not include any stipulations that provide the lender with the right to bypass the non-recourse laws. Most lenders and homeowners hire a short sale lawyer prior to the home sale occurring, but sometimes lawyers are only hired after a short sale occurs as a result of a disagreement between the parties involved.
