September 9, 2017
- in Short Sales by Minna Reid
What does it take to get approved for a short sale?
There are many reasons for having to short sell, but how do you know if you qualify for a short sale?
Once in a while I get a call where a prospect client says “I don’t have any hardship at all, I just want out and I can’t sell”. Just wanting out is not a reason that is likely to get you quaified for a short sale. However, when I dig for more information – 99% of the time there is some legitimate reason the homeowners do need to sell, which I would actually consider a hardship. There are many hardships that result in approved short sales, even those that don’t sound much like “hardships” at all.
Let start with the most common hardships that are easily approved and widely accepted by lenders:
Facing foreclosure- Unemployment/underemployment
- Employment or military based relocation
- Divorce or separation
- Death of a co-borrower/household wage earner
- Unaffordable mortgage
- Increase in expenses
- Decrease in income
- Business failure
- Natural disaster impacting property or employment
- Medical issues
However there are many other reasons to short sell that do translate in to qualifying hardships. I have personally seen short sales approved for many reasons such as:
- The homeowner wanted to leave place of employment to go back to school to pursue a degree
- A voluntary employment change where the borrower started a new career in lesser paying field
- The borrower wanted to leave town to care for an ailing relative in another state
- Since buying the home, homeowners had children causing the home to be too small for their needs
- Since buying the home, homeowners found out they were infertile and could not have children, leaving them with a home too large for their needs
- Homeowners found their commute too long and wanted to relocate to be closer to job
- Clients had bought a new home and failed to sell the old at a price to satisfy mortgage debt
- Investor owners ended up with tenants gone wrong
Does my situation qualify for a short sale?
There is a lot of misinformation out there on the web regarding what is and is not an acceptable hardship. I have seen many unlikely-to-be-approved short sales actually get approved. There are a lot of variables to every short sale and no cut and dry rules for any. Before assuming your “hardship” doesn’t qualify – speak to a local short sale professional.
Reid Real Estate Group has been CT's #1 short sale team since 2010, and we have helped hundreds of homeowners out of their upside down homes and onto the next chapter!
Last Updated on July 4, 2020 by Minna Reid
