That advise is typical.....and correct
The lender will not approve a short sale if the borrower has sufficient income to pay their mortgage or if they have other assets sufficient to cover any shortfall If the borrowers loan is current she has demonstrated the ability to pay and there will be no short sale approved. Falling behind on your payments is not the only evidence needed to qualify for a short sale, but it is probably necessarry
Also consider that if the debt is forgiven than the borrower will get a 1099 for the shortfall and unless they are insolvant will owe the IRS.
Adriana,
I thought I would never say this but, I kind believe the bank has a point. If they allow your friend to sell her house short or for a loss to the bank and allow her to go on her marry way, what is preventing her from going down the street and buying another house the next day? So if they have you miss a few payments, they can note this on your friends credit report and prevent her from going out and buying that next house. I'm actually getting tried of hearing about homeowners that bought to much house and can't make the payments now so they want an easy out. I don't want to be mean but, people like your friend maybe shouldn't own a house for a while. If we keep bailing them out what is preventing them from doing it again and again. One last thing by letting all these people take the easy road out of their troubles kinds of belittles all the homeowners out there that saved for their homes and that are making their payments day in and day out.
I wish your friend the best luck.
Lenders usually are looking for a real and actual "hardship". I've seen where some lenders want to see utility services disconnected too. If banks and/or lenders welcomed short-sales, probably 70% or more mortgagors would get in line!
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