This one factor can determine if a short sale will be approved or not.

Little do consumers know that when they are looking to buy or sell a home that is a short sale that one factor can either make or break the deal. Just because a home owner is “under water” or owes more than what their home is worth, does not mean that the seller would qualify for a short sale. The most important factor that the seller must take into account is if they have a verifiable hardship. Banks are making it more challenging to get short sales approved these days. If the seller can afford to make the mortgage payment for the home, no matter what they plead is their case for a hardship, banks will typically never approve a short sale.

If you are thinking of buying a home that is a short sale, and you have been able to find out that there is a true financial hardship, make sure you get the answers to these following questions too.

1.) How many liens are on the home? Are there any tax liens (unpaid taxes), association dues liens (unpaid association dues or special assessments) or contractors liens on the property? Is there a home equity loan or second mortgage on the subject property?

2.) Is there an offer already submitted. Short sales take a long time to get processed. I would say on average, it takes anywhere from 5-6 months to get an answer from the bank if they will approve or not the short sale. Often, home buyers will walk away from a short sale after a few months because they lose interest or find another home and to purchase. Some listing agents will continue to keep that original offer on the subject property to find out if the bank would accept a sales price of what the original offer is. This can help cut some months off the waiting process for you if there is already another offer submitted.

3.) Who is handling the short sale? There are all levels of different ways a short sale can be submitted to a bank for approval. Some Realtors handle their own transactions, some attorneys will handle short sales negotiations or some title companies will handle these. It is important to know who will be handling the transactions and to know their level of knowledge in the process.

Bottom line… make sure there is a verifiable financial hardship. If the listing agent will not disclose this information to you, then you should highly considering saving yourself time and frustration and move on to another home to purchase.


Leave a comment

Filed under Uncategorized

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s