In a Short Sale “Is it better that I move out?”

Sellers ask this all the time. The answer is the seller can stay in the house all the way up to the closing of the sale to the new buyer.

There are actually many questions behind this question:

Question: Will the bank be angry that I’m living in the house without paying?

Answer: The bank realizes that many borrowers can’t pay. That’s why they have the short sale program. You didn't create this housing slump or job market crisis.

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Question: Does the bank want me to move out because I’m not paying?

Answer: No. The bank prefers you stay in the house. If you are in the house they know the house will be maintained, the grass will be cut, the utilities will be on, pipes won’t freeze, and the likliehood of vandalism will diminish.

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Question: So the bank is OK with me living free in the house?

Answer: Actually, some lenders REQUIRE that you stay in the house until it sells. That’s how important it is to them that you remain.

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Question: But I’m afraid that the sheriff will show up with no notice and throw me out.

Answer: The sheriff cannot evict you before the house actually sells at the foreclosure auction. You will get many letters and notices prior to the auction. Please read a previous article Pre Foreclosure Myth: The Sheriff Can Show Up With No Notice And Throw My Family Out for more details.

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Question: What if I must move out or really don’t want to stay in the house anymore?

Answer: In most cases that’s fine also. If you have to move on with your life that’s understandable. Please check with your short sale specialist Realtor if moving out will impact your eligibility.

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Also, a skilled short sale Realtor will keep you informed of progress and will get your auction postponed to enable the short sale to be completed so you can avoid foreclosure.

These questions are all valid concerns. But notice that the answers are the exact opposite of conventional wisdom. Such is the nature of short sales.

If you are in the Louisville, KY area please call me (502) 664-7827 at any time with any questions you may have. Nights and weekends are welcome, too. Call me at any time that is most convenient for you.